The US Senate confirmed attorney Jay Clayton as the new head of the Securities and Exchange Commission tasked with regulating Wall Street and America’s financial sector.
Some Democrats joined Republicans to vote 61 to 37 in favor of Clayton, who was nominated by US President Donald Trump in January.
Once Trump’s White House completes the process, within days, Clayton will be sworn in as chairman of the SEC, which operates as an independent government agency.
Trump has said he wants Clayton to loosen rules seen as impeding investment in the United States, while “restoring” supervision of the banking sector.
Clayton, whose career was essentially New York-based, has notably been an investment adviser to wealthy families and others as partner at the law firm Sullivan & Cromwell, which specializes in mergers and acquisitions.
Some of his clients included Wall Street titans, such as the bank Goldman Sachs, which he will now have to watch over.
The SEC was created in 1934, after the Wall Street stock market crash of 1929. It played a major role in US financial regulation, tracking insider trading and imposing penalties and fines for violations of banking oversight rules.
The agency was harshly criticized for mistakes and lack of reactivity in the 2008 crash, the massive fraud by former stockbroker Bernie Madoff and the Enron scandal of 2001.
During his Senate hearing for the post in March, Clayton declared he would make sure there was “zero room for bad actors in our capital markets.”
Trump’s administration wants to roll back the Dodd-Frank law enacted after the 2008 financial crisis designed to curb excesses in the sector and prevent systemic risk.
Critics claim the mammoth law has created too much red tape that stifles the industry.
The Dodd-Frank rules require banks to demonstrate solid financial grounding in annual “stress tests” as well as refrain from certain risky transactions. They also significantly expanded the role securities regulators play in overseeing the investment industry.
Clayton said in his Senate hearing he didn’t have “any specific plans for an attack” on Dodd-Frank, but backed a review to evaluate how effective its rules have been.