Reid pushes for SEC chairman’s resignation

Benjamin Grove

Tuesday, July 23, 2002 | 11:06 a.m.

WASHINGTON -- Sen. Harry Reid, D-Nev., on Monday joined lawmakers calling for the resignation of Securities and Exchange Commission chairman Harvey Pitt.

"The SEC needs a new leader, somebody free from conflict of interest, who recognizes how damaging even the appearance of conflict of interest is at this sensitive time for America's financial well-being," Reid said in a speech on the Senate floor.

In an interview later, Reid predicted, "He's history. He's outta here. It's just a question of when."

Reid said Pitt, a former Wall Street lawyer with accounting firm clients, is too closely tied to big accounting firms and corporate America.

"It is trite, but it seems to me it is installing the fox to protect the hen house," Reid said in a speech on the Senate floor.

Reid said Pitt's ouster would help bolster flailing stock markets.

"It would send a strong message to Wall Street, to the people who work for the corporations in Wall Street, the people who earn a living making that stock as valuable as it is."

President Bush has backed Pitt, and so have many Republicans who say Democrats are calling for Pitt's ouster merely to gain political traction. Pitt's critics are mostly Democrats, but a few GOP lawmakers have joined the chorus, including Sen. John McCain, R-Ariz.

Reid, who often leads Democratic charges against Bush and GOP proposals, dismissed the notion that his motives were political.

"I think in government we must deal not only with what is bad, but what looks bad," Reid said, saying that Pitt's friendly relationship with accounting firms "just doesn't look right."