Alyssa GregorySchool of Law Dean Joel Seligman is currently under consideration to head the new Public Company Accounting Oversight Board (PCAOB) of the Securities and Exchange Commission (SEC), and the campus community should give him its full support.
With the position open, the SEC is now in the process of selecting among more than 500 candidates to takeover the position left by William Webster. One of the top candidates for this position is Dean Seligman, noted by Newsday as being a “solid candidate.”
While dean of the law school, Dean Seligman has brought in Nobel laureate speakers and launched the Center for Interdisciplinary Studies and the Institute for Global Legal Studies, which are designed to bring in the most eminent speakers and analysts of law for speeches and symposia.
Outside his writing and functions as dean of the law school, Dean Seligman has also been extremely focused on the life of students. He has taught up to two courses a semester and is known through the school as being easily approachable and concerned for students.
Beyond being the dean of the law school, Dean Selig-man has written prolifically, specifically on the topic of the SEC, its history, and the securities industry in general. Among the numerous legal articles and 18 books Seligman has written or co-written, “The Transformation of Wall Street” is probably his most famous.
Dean Seligman’s reputation as one of the leading scholars of the securities industry is known throughout the nation. Many financial journals and weeklies turn to him for his opinion on the activities of Wall Street.
A Washington People article entitled “A Giant in Studies of Securities Law,” highlighted the achievements of Dean Seligman. The author, Ann Nicholson, notes that Former Securities and Exchange Commission Chairman Arthur Levitt once joked at a law school conference that if the Library of Congress’ wing of historical documents on the nation’s markets burnt down, the government could call Joel Seligman, J.D., with the request, “Could you just start from the beginning?”
In the wake of the Enron and Worldcom financial scandals of late, what has been unearthed is not only that certain corporations cheated their investors out of millions of dollars, but also that the accounting firms which handled their financial statements assisted them in these illegal endeavors. Auditing and accounting companies such as Arthur Andersen aided companies like Enron in doctoring budget sheets so as to hide huge losses and thus, not worry investors, even as the company was on the brink of filing bankruptcy.
It was for this reason that the SEC created the PCAOB, which is intended to periodically audit the auditors.
In 2002, former FBI and CIA director William Webster, who also has affiliations with WU, was chosen by the five SEC commissioners in a vote split primarily along party lines. Later that year however, Webster stepped down from his post due to his connections with U.S. Technologies Inc., a nearly bankrupt Internet company under investigation for fraud.
In the search for a new head of the PCAOB, Dean Seligman has stated in the Los Angeles Times that “the challenge [in finding a new head] is to find a leader who leaves client interests at the door, understands the regulatory process… and can work well with Congress and the White House.” Dean Seligman seems to fit all these self-prescribed criteria.
One of the defining weaknesses of the PCAOB lies in that the when the board finds problems with an auditing firm, the information will be held secret if the firm deals with the issue within a year. Furthermore, disciplinary proceedings may remain secret until the SEC has considered appeals of the board’s rulings, a process that in all could take years.
What this all means is that investors will have limited means of assuring sure that the board is doing a good job, thus making it all the more important that the board’s chairman be someone with a reputable record. Who better for the post than an academic with no corporate affiliations, who is talked about in some circles as being the definitive scholar regarding securities law?
As chairman of the PCAOB, Dean Seligman would infuse the public with confidence in that accounting firms are being closely watched and regulated. Therefore, the campus community should support Dean Seligman and his nomination for chairman of the PCAOB. With him at the helm, there may no longer be a need for whistle-blowers on Wall Street.