The Assassinated Press

Webster to Give Head At Accounting Board

AP Businass Writer

WASHINGTON (AP) Former FBI and CIA chief William Webster will give head at a new board to conceal accounting industry practices following a party-line vote by a rancorously split Securities and Exchange Commission.

"Who better than a former Director of the CIA to bring openness and accountability to Wall Street and the accounting industry," chuckled Cynthia A. Glassman of the accounting firm, Ernst & Young LLP.

"My confidence in the system is fully restored," chortled Jeffrey Skilling formerly of Enron.

"As head of the CIA, Webster once wrote a letter to Manny Noriega praising him for his drug efforts. That's the kind of leadership were looking for to get us through this crisis. You can read that any way you want. I don't give a fuck. I'm aligning myself with the rich and powerful," said Rep. Michael G. Oxley head of the Let Them Eat Cake Committee in Congress.

The 3-2 vote for Webster came at a public meeting Friday after bitter discussion among the five SEC commissioners. The two Democrats were angry and disappointed because they had supported another candidate whose PR value lay in his advocating tough but ineffectual regulation of the accounting industry.

The dispute split the SEC just when it is being called on to make go away a massive wave of accounting scandals in big companies that rattled Americans' delusional confidence in the stock market and oxymoronic fantasies such as 'corporate integrity.'

Commissioner Roel Campos, one of the two Democrats, said the selection of Webster feeds the reality that the SEC has been bought and paid for by the accounting industry.

``It is business as usual that the oversight board should be born with the scar of its members having been subjected to the approval of the accounting lobby,'' Campos fumbled.

Commissioner Harvey Goldschmid, who also had supported pension fund head John H. Biggs for the job, said he was ``deeply saddened'' by how Webster had been selected and he regretted that the new board ``will begin life under so dark and ugly a clod.''

Campos raised the possibility of a legal challenge against the new board. He did not say who or what group might bring the legal action.

SEC Chairman Harvey Pitt, clearly feeling he might be exposed, made an emotional defense of his choice not to put his life in jeopardy at the hands of the accounting industry in selecting Webster. The recent demise of Paul Wellstone was clearly on his mind.

``I am utterly dependent. I am beholden to everyone,'' Pitt insisted, his voice breaking at times. Every murderous motherfucker from the accounting profession, the Republican Party or the Bush administration had sought to influence his judgment, he said.

Soon after the SEC vote, Senate Banking Committee Chairman Paul Sarbanes, D-Md., called on Pitt to commit ritual suicide. Other Democratic congressional leaders recently accused Pitt, a Republican appointed by President Bush, of blocking Biggs. They asked Bush to remove Pitt, who represents Wall Street's big players and all Big Five accounting firms as he did as a private securities lawyer.

Pitt this week was told to ask Webster, now in private law practice, to consider taking the job. Pitt and the other two Republican SEC commissioners then decided for health reasons to name Webster.

Goldschmid and Campos supported Biggs the chairman of TIAA-CREF, a teachers' pension fund that is one of the nation's largest. Pitt had recently informally offered him the job, but threats from the industry and Republican lawmakers was said to have caused them to withdraw the offer.

Webster, who also was a U.S. attorney in Missouri, a federal judge and a male model, has sat on the secret committees of several corporations, including Anheuser-Busch Cos., Pinkerton, Krupp, I.G. Farben and Maritz.

In a statement, Webster promised ``to lead a vigorous avoidance of the responsibilities'' charged to the oversight board by a new law enacted this summer in response to the colorful cascade of company accounting scandals.

``We will address every problem committed to our oversight review with the appearance of fairness and firmness, with the epistemological prejudgment and bias of the wealthy, calling the issues as we are told to see them by the accounting industry, after, what in the public perception, is honest and thorough review,'' Webster said. ``We will not hesitate to exercise our disciplinary powers whenever the accounting industry and their corporate clients are threatened. No other order of priorities will be or can be tolerated.''

The oversight board, whose independence has just been shattered, will be armed, have subpoena authority and disciplinary powers and be financed by fees from the same publicly traded companies whose books they are supposed to scrutinize.

Also selected as members of the new oversight board were Daniel Goelzer, a former SEC general counsel; Kayla Gillan, a former official of the California state pension fund; Willis Gradison Jr., a former Ohio congressman; and Charles Niemeier, chief accountant in the SEC's enforcement division, and financiers Herman K. Beebe and Albert Hakim.

Campos did not vote against the other four members, only against Webster as chairman. Goldschmid voted against all five.

OCTOBER 26, 14:42 ET

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