US financial watchdog boss named

Mary Schapiro has been named the next head of the US financial watchdog, the Securities and Exchange Commission.

President-elect Barack Obama officially nominated Ms Schapiro, whose role must be confirmed by the Senate.

Mr Obama said she would "crack down on the culture of greed and scheming that has led us to this day of reckoning".

The watchdog faces growing criticism for its failure to protect investors - particularly over its role in the alleged $50bn fraud by Bernard Madoff.

A former SEC commissioner, Ms Schapiro is currently head of the Financial Services Regulatory Authority.

Mr Obama said that under her leadership, the SEC would "protect investors, consumers and our entire economy from fraud and manipulation by an irresponsible few".

Madoff scandal

She previously chaired the Commodity Futures Trading Commission and served for six years as an SEC commissioner under Presidents Ronald Reagan, George H W Bush and Bill Clinton.

Ms Schapiro is well-respected in Washington circles as a regulator and is considered an effective, if somewhat low-key, administrator.

Barbara Roper, of the Consumer Federation of America, said that Ms Schapiro would bring "significant administrative experience" to the job.

That would be useful "given that we're looking at what is essentially a broken agency", she said.

'Grave concerns'

The SEC has been buffeted by criticism for failing to detect signs that major Wall Street banks were in trouble before the financial crisis erupted and for possibly lax oversight and enforcement in other areas.

As the scandal involving Mr Madoff stunned Wall Street, revelations have surfaced that staff at the SEC repeatedly failed over the course of a decade to fully investigate credible allegations against him.

SEC chairman Christopher Cox said on Tuesday he was "gravely concerned" by the breakdown in oversight and ordered the agency's inspector general to investigate what went wrong.

Senator Charles Schumer, a member of the Senate's banking committee said Ms Schapiro was "the kind of strong and experienced regulator that we very much need in these times".

"I believe her nomination could be approved quickly and without controversy in the Senate," he added.