President-elect Barack Obama said Thursday that Washington has been "asleep at the wheel" in the run-up to the nation's economic crisis and named three veteran financial regulators who he said were "ready and willing to enforce the law."
"The American people right now are feeling frustrated that there is not a lot of adult supervision out there, whether it is the political world or the financial world," Obama told reporters in announcing the appointments.
Obama said the alleged $50 billion fraud by Wall Street investor Bernard Madoff "has reminded us once again how badly reform is needed when it comes to rules and regulations that govern our markets."
The president-elect said he intended his appointments to demonstrate that "we are operating not just out of greed, but also out of the sense of the common good."
"We have been asleep at the switch, not just the regulatory agencies but some of the Congressional committees that might have been taking a look at this time," Obama said. "We have not been as aggressive and we had a White House that started with the premise that deregulation was always good."
He said he intended to make sure that regulatory agencies "are led by individuals who are ready and willing to enforce the law."
•Mary Schapiro to chair the Securities and Exchange Commission, where she served previously as a commissioner in Republican and Democratic administrations. The SEC has recently come under strong criticism for failing to spot the alleged Madoff fraud.
Schapiro, who Obama called "smart and tough," is CEO of the Financial Industry Regulatory Authority, a non-governmental regulatory group for securities firms and is also a former head of the Commodity Futures Trading Commission.
•Gary Gensler, a Treasury official in the Clinton administration, to head the Commodity Futures Trading Commission, an independent agency. Gensler was a senior adviser to former Democratic Sen. Paul Sarbanes, of Maryland, who authored legislation to increase oversight of the accounting industry and reform corporate governance. Obama, in introducing Gensler, said he would "restore sound judgment and strict oversight to our markets."
•Daniel Tarullo for a seat on the Federal Reserve Board. Tarullo is a Georgetown Law professor who also worked for former President Clinton, and is leading Obama's transition team at the Treasury Department. He will fill an open seat on the board in Washington. The selection of Tarullo is subject to approval by the Senate. All of the present board members, including chairman Ben Bernanke, were named by President Bush.
In referring to the Madoff case and other recent financial debacles, Obama called for "new common-sense rules of the road" to protect Wall Street and Main Street.
The current SEC chairman, Christopher Cox, has called for an investigation into the Madoff operation, but said that there was no evidence, thus far, of any wrongdoing by SEC personnel.
SEC Inspector General David Kotz is looking into the agency's failure to uncover the alleged fraud in the Madoff case. One area Kotz said he will examine is the relationship between a former SEC attorney, Eric Swanson, and Madoff's niece, Shana, who are now married.
Contributing: Douglas Stanglin, in McLean, Va.; the Associated Press