US SEC Compliance Chief Resigns After Five Days On The Job By Reuters

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By Katanga Johnson and Chris Prentice WASHINGTON (Reuters) – Alex Oh, who last week became the first woman of color to lead the U.S. securities control division, resigned Wednesday due to potential conflicts of interest created by her previous work as a lawyer, according to the agency and a person with direct knowledge of the matter. The unusual turn of events is a severe blow to new Securities and Exchange Commission (SEC) chairman Gary Gensler, for whom Oh was one of his first big hires, and underscores the challenges of filling the top positions in the company. agency with Wall Street defense attorneys. In his resignation letter to Gensler on Wednesday, shared with reporters, Oh said an “event” related to one of his previous cases would be “an unwanted distraction from the Division’s important work.” The issue at issue relates to Oh’s work defending Exxon Mobil Corp (NYSE 🙂 against a lawsuit in her previous role as a partner of Paul, Weiss, Rifkind, Wharton & Garrison, according to a person familiar with the matter who requested the anonymity to share the information. The SEC is investigating Exxon Mobil on asset valuation issues, according to a January Wall Street Journal report, and the matter could create a potential conflict of interest if Oh remained in office, agency sources said. This issue caught the attention of SEC officials this week, the person said. Oh previously served as co-director of Paul, Weiss’s anti-corruption team. During his 17 years at the firm, he worked for a host of Fortune 100 corporations and companies. Oh decided to resign after United States District Judge Royce Lamberth in an order Monday raised questions about his conduct during a deposition at the Exxon case, according to the order and the person with knowledge of the matter. Brad Karp, president of Paul, Weiss, could not comment on the ongoing litigation, but added: “Alex is a person of the highest integrity and a consummate professional.” An Exxon representative did not immediately provide comment. While other SEC officials, including former Chairman Jay Clayton, have had long careers in private practice, progressives have lobbied Democratic President Joe Biden‘s administration to avoid industry hires because of concerns about possible conflicts of interest. After his appointment on April 22, a group of advocacy groups wrote to Gensler saying they were “deeply surprised and concerned” by his election. “The SEC has failed the American people by repeatedly selecting Wall Street defense attorneys as enforcement directors,” said Dennis Kelleher, chief executive of Better Markets, a Washington group that advocates for Wall Street reform. “They come to the SEC with unnecessary and useless baggage, including crippling conflicts of interest with respect to current and past clients, as well as a mindset … inadequate to be an aggressive enforcer,” he added. The agency appointed Melissa Hodgman as interim director of the division, a position she previously held between January and April.