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Senate sets SEC vote, Cox foes seek delay

Posted on: Thursday, 28 July 2005, 00:54 CDT

WASHINGTON (Reuters) - The Senate Banking Committee said it would vote on Thursday morning on the nomination of Rep. Christopher Cox to become chairman of the U.S. Securities and Exchange Commission.

The panel is expected to approve Cox's nomination, said congressional aides, with a favorable vote sending the California Republican's name to the floor of the full Senate for final consideration.

Cox went answered questions before the committee on Tuesday. The scheduling of a committee vote for just two days later came as opponents of Cox, who are fearful the free-market conservative would oversee a regulatory rollback, urged the committee to ask him more questions.

The Foundation for Taxpayer and Consumer Rights -- a group that has previously worked with the former high-profile plaintiffs' law firm Milberg Weiss -- on Wednesday accused Cox of "potential perjury."

The group said Cox's testimony "omitted important facts about the extent of his involvement with a web of companies that perpetrated a $130 million fraud on small investors."

At the confirmation hearing, committee Chairman Sen. Richard Shelby and senior Democrat Sen. Paul Sarbanes asked Cox about his work in the 1980s as a private lawyer for First Pension Corp., a former pension-funds administrator.

A Cox spokesman referred questions to the White House, , where a spokeswoman said Cox had adequately answered questions about First Pension at the hearing.

"This matter concerns work congressman Cox did in private practice decades ago. It was fully looked into in court proceedings and congressman Cox won the case. The court dismissed all causes of action against him," the White House spokeswoman said.

The SEC charged First Pension and three officers with fraud in May 1994. Former First Pension owner William Cooper pleaded guilty in August 1994 to criminal fraud charges. In the early 1980s, Cox did legal work for First Pension when he was working at law firm Latham & Watkins. Cox was elected to Congress in 1988.

Cox has said he did preliminary work on a securities offering for a First Pension affiliate. The work was not involved in the criminal case against Cooper, he said at his confirmation hearing on Tuesday.

A court also dismissed Cox as a defendant in a later shareholder class-action lawsuit over the First Pension scandal. "The court dismissed all of the claims against me in that lawsuit," Cox told the committee.

Cox would take over the SEC from William Donaldson, who quit as chairman on June 30 after two years on the job.

Cox has been strongly endorsed by Republicans and securities industry groups eager to loosen SEC rules adopted in the wake of corporate scandals such as the Enron Corp. collapse in 2001.

Democrats, unions and investor activists, concerned about the possibility of looser rules, have opposed the nomination.

Plaintiffs' law firms -- such as the former Milberg Weiss, which recently split into two firms -- have been persistent foes of Cox. In 1995, Congress passed a law he wrote that made it more difficult to sue corporations for fraud.

The banking committee is also scheduled to vote on Thursday on two Democratic SEC nominations: renewal of incumbent SEC Commissioner Roel Campos and Annette Nazareth, now director of the commission's Market Regulation division.

Source: REUTERS

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