Sen. Elizabeth Warren (D-Mass.) on Tuesday accused the head of the Securities and Exchange Commission of intentionally misleading her.
Warren wrote to SEC chair Mary Jo White, saying that “there could not have been a misunderstanding” when the top federal regulator last month divulged to her, in a private meeting, bogus information about an impending rule.
The regulation, which was mandated in 2010 by Dodd-Frank financial reform, would force a company that publicly trades securities to disclose the ratio in pay between its CEOs and its median worker.
What White said to Warren “was contradicted by an Office of Management and Budget (OMG) publication released that very same day,” the senator said [emphasis hers].
“I am perplexed as to how and why you would have provided me with this misinformation.”
Warren explained that when the pair met on May 21, White said, according to the lawmaker, that she “hope[d] to be done by fall” with the CEO pay disclosure rule and that there should not “be anything that holds it up past this fall.”
But Warren noted that on the same day, the OMB said the SEC is not expected to complete the rule-making process until April 2016—an announcement that revealed a six month delay, per the deadline previously posted by OMB.
“I cannot understand how and why this rule has been delayed for so long, and I am perplexed as to why you told me personally that the rule would be completed by the fall of 2015 when it appears that you were or should have been aware of additional delays,” Warren wrote.
Warren sent the letter to air a range of grievances with White and accused her of having “broken those promises” she made during her 2013 confirmation hearing.
In addition to the inaction on the required-by-law CEO pay ratio rule, Warren charged the SEC under White with reneging on promises to obtain admissions of wrongdoing from companies that the commission extracts settlements from, and for issuing waivers in, every other case, when convicted companies ask for them. She noted that in September 2013, the SEC started granting waivers to companies found guilty of criminal misconduct “for the first time since 2005.”
Warren additionally bemoaned White’s conflicts of interests and cited a New York Times article which reported that the SEC chair “has had to recuse herself from more than four dozen enforcement investigations…sometimes delaying settlements and opening the door, in at least one case, to a lighter punishment.”
“As you know, the impact of a recusal on the operations of the SEC can be quite damaging,” Warren wrote. “If, for example, the SEC is split 2-2 on whether to pursue a prosecution, your recusal would mean that no prosecution could go forward.”
The firebrand legislator also called on White to pass a rule forcing publicly-traded companies to disclose their political spending. Over one million public comments have been submitted since 2011 in favor of that proposed regulation, Warren noted.
She asked White to respond to her letter by July 1.
Read Warren’s letter here.
Listen to Alexis Goldstein discuss the SEC, waivers and the political spending disclosure rule on District Sentinel Radio here.
