SEC chief's stock high despite funds, NYSE scandal

"SEC chief's stock high despite funds, NYSE scandals:


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By Kevin Drawbaugh

WASHINGTON, Feb 22 (Reuters) - When William Donaldson took over to wide acclaim as top U.S. markets cop a year ago, Richard Grasso was still ringing the Big Board bell and mutual funds were still seen as beyond reproach.

Times have changed. Grasso is out at the New York Stock Exchange. The mutual fund industry is mired in scandals.

And Donaldson? After a turbulent year as chairman of the U.S. Securities and Exchange Commission, he is pushing ahead with a range of reforms and getting reviews more measured than his first few months, but still generally favorable.

In an interview, the 72-year-old Wall Street banker cited one first-year frustration. 'Being hit by the mutual fund thing was a disappointment,' but he added, 'I'm very pleased with the way we've gone after these abuses.'

Donaldson headed the SEC at a tough time. It was grappling in February 2003 with the end of Chairman Harvey Pitt's troubled tenure and a crushing workload to implement dozens of post-Enron reforms ordered by Congress.

'There was a feeling of pressure here and morale problems,' said the co-founder of investment bank Donaldson Lufkin & Jenrette and former NYSE chairman. 'We're on an uptick now.'

Outside critiques of his performance are broadly positive.

'I have been delighted by a number of the things he's done ... I don't want to say he's done everything I wanted. But I've been happy,' said Nell Minow, outspoken investor advocate and co-founder of The Corporate Library, a research firm."