Definition of "Security": An evidence of debt or of property, such as a bond or a stock certificate.
The Securities and Exchange Commission (SEC) functions as a sort of watchdog over Wall Street, responsible for protecting investors, maintaining fair, orderly and efficient markets, and facilitating capital formation. The SEC does this by requiring public companies to disclose “meaningful financial and other information to the public,” so that investors can make informed decisions about whether to buy, sell or hold a particular security. The SEC oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors and mutual funds. The commission also brings civil enforcement actions against individuals and companies for violating the securities laws, including insider trading, accounting fraud and providing false or misleading information about securities and companies issuing securities.
The foundations of the Securities and Exchange Commission (SEC) were laid in the era before the Great Crash of 1929, when there were few regulations governing the sale of securities in the United States. After World War I, securities trading surged, but little effort was made by federal officials to regulate the industry by requiring financial disclosure of participants.
Investors increasingly moved to invest in risky securities during the 1920s, when credit was easy and rags-to-riches stories dominated the national consciousness. Approximately 20 million large and small shareholders set out to make their fortunes this way, and it is estimated that of the $50 billion in new securities offered during this period, half became worthless.
The stock market crash of October 1929 immediately destroyed consumer confidence in financial markets. Investors lost huge sums of money, and banks quickly failed as the Great Depression took hold. To help the economy recover, Congress held hearings to identify the main problems and help restore the public’s faith in capital markets.
In 1933, during the peak year of the Depression, Congress passed the Securities Act of 1933. Together with the Securities Exchange Act of 1934, which created the SEC, the legislation was designed to help investors feel more comfortable about putting their money back into the stock market. It did this by providing investors with reliable information and clear rules for dealing honestly in the securities markets. Companies offering securities were required to tell the truth about their business, the securities they were selling, and the risks involved in investing. Additionally, the people selling trade securities had to treat investors fairly and honestly, putting their interests first.
President Franklin Roosevelt appointed Joseph P. Kennedy (father of future President John F. Kennedy) as the first chairman of the SEC.
In 1940 the SEC brought actions against nine of the country’s 13 largest public utilities holding companies. Through these actions, the SEC restructured the utilities industry.
In the 1950s the SEC underwent staff reduction due to budget cuts. From 1,200 people in the 1940s, the SEC shrunk to less than 700. This downsizing trend was stopped by President John F. Kennedy, who restored funding for 250 jobs at the commission.
In 1969-1970, the securities industry was rocked by a series of voluntary liquidations, mergers, receiverships and bankruptcies of a substantial number of brokerage houses. The situation caused a downturn in investor confidence and lawmakers worried over a possible “domino effect” involving otherwise solvent brokers that had substantial open transactions with firms that failed. To address the crisis, Congress adopted the Securities Investor Protection Act, which led to the creation of the Securities Investor Protection Corporation (SIPC). Financed through fees from broker-dealers, the SIPC initially provided $50,000 of insurance to brokerage customers in the event a brokerage firm went bankrupt.
During the 1980s, the SEC came under criticism at a time when Wall Street was running amok with acts of insider trading and other illegal or unethical financial maneuvers. The decade was marked by investor scandals involving such figures as Ivan Boesky, Michael Milken and Dennis Levine, along with the Stock Market crash of 1987.
Virtual Museum and Archive of SEC and Securities History
The Securities and Exchange Commission (SEC) is responsible for protecting US investors from potential loss of income by maintaining fair and orderly practices to encourage capital markets. The commission requires businesses to disclose meaningful information about securities they sell, so that investors can make informed decisions.
The SEC also oversees participants in the securities world, including exchanges, brokers and dealers, financial advisors and mutual funds, and can bring civil suits against individuals or companies that break the securities laws. The commission is charged with interpreting federal securities laws, issuing new rules and amending existing rules, overseeing the inspection of securities firms, brokers, investment advisors and ratings agencies, maintaining private regulatory organizations in the securities, accounting and auditing fields, and coordinating US securities regulation with federal, state and foreign authorities.
The SEC consists of five commissioners appointed by the President, who serve staggered five-year terms. One commissioner is designated (by the President) as chairman of the commission, and no more than three of the commissions may belong to the same political party.
SEC divisions:
Division of Enforcement handles the SEC’s law enforcement function by recommending the investigations of securities law violations and that the commission bring civil actions in federal court or before an administrative law judge, and by prosecuting these cases on behalf of the commission. As an adjunct to the SEC’s civil enforcement authority, the division works closely with law enforcement agencies in the US and around the world.
Common violations that may lead to SEC investigations include: misrepresentation or omission of important information about securities; manipulating the market prices of securities; stealing customer funds or securities; violating broker-dealers’ responsibility to treat customers fairly; insider trading (violating a trust relationship by trading on material, non-public information about a security); and selling unregistered securities.
Division of Corporation Finance oversees corporate disclosure of important information to the investing public. Corporations are required to comply with regulations pertaining to disclosure that must be made when stock is initially sold and then on a continuing and periodic basis. The division’s staff routinely reviews the disclosure documents filed by companies. The staff also provides companies with assistance in interpreting the commission’s rules and recommends to the SEC new rules for adoption.
The Division of Corporation Finance provides administrative interpretations of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Trust Indenture Act of 1939, and recommends regulations to implement these statutes. Working with the Office of the Chief Accountant, the division monitors the activities of the accounting profession, particularly the Financial Accounting Standards Board (FASB), that result in the formulation of generally accepted accounting principles (GAAP). Increasingly, the division monitors the use by US registrants of International Financial Reporting Standards (IFRS) promulgated by the International Accounting Standards Board.
Division of Investment Management takes care of investor protection and promoting capital formation through oversight and regulation of America’s $26 trillion investment management industry. This important part of US capital markets includes mutual funds and the professional fund managers who advise them; analysts who research individual assets and asset classes; and investment advisers to individual customers. Because of the high concentration of individual investors in the mutual funds, exchange-traded funds, and other investments that fall within the division’s purview, the Division of Investment Management is focused on ensuring that disclosures about these investments are useful to retail customers, and that the regulatory costs which consumers must bear are not excessive.
The division’s additional responsibilities include assisting the SEC in interpreting laws and regulations for the public and helping SEC inspection and enforcement staff. It also responds to no-action requests and requests for exemptive relief, reviews investment company and investment adviser filings, assists the commission in enforcement matters involving investment companies and advisers, and advises the commission in adapting SEC rules to new circumstances.
Division of Trading and Markets provides day-to-day oversight of the major securities market participants: the securities exchanges; securities firms; self-regulatory organizations (SROs) including the Financial Industry Regulatory Authority (FInRA), the Municipal Securities Rulemaking Board (MSRB), clearing agencies that help facilitate trade settlement; transfer agents (parties that maintain records of securities owners); securities information processors; and credit rating agencies.
The division also oversees the Securities Investor Protection Corporation (SIPC), a private, non-profit corporation that insures the securities and cash in the customer accounts of member brokerage firms against the failure of those firms. SIPC insurance does not cover investor losses arising from market declines or fraud.
The division’s additional responsibilities include carrying out the SEC’s financial integrity program for broker-dealers, reviewing (and in some cases approving, under authority delegated from the commission) proposed new rules and proposed changes to existing rules filed by the SROs, assisting the commission in establishing rules and issuing interpretations on matters affecting the operation of the securities markets, and monitoring the markets.
SEC offices:
Office of Compliance Inspections and Examinations administers the SEC’s nationwide examination and inspection program for registered self-regulatory organizations, broker-dealers, transfer agents, clearing agencies, investment companies and investment advisers. The office conducts inspections to foster compliance with the securities laws to detect violations of the law and to keep the commission informed of developments in the regulated community. Among the more important goals of the examination program is the quick and informal correction of compliance problems. When the office finds deficiencies, it issues a “deficiency letter” identifying the problems that need to be rectified and monitors the situation until compliance is achieved. Violations that appear too serious for informal correction are referred to the Division of Enforcement.
The Office of the Executive Director formulates budget and authorization strategies, supervises the allocation and use of SEC resources, promotes management controls and financial integrity, manages the administrative support offices, and oversees the development and implementation of the SEC’s automated information systems. The office has three main areas:
1. The Office of Administrative Services assists the chairman and the executive director in managing the agency’s facilities and assets and provides a wide range of support services to the SEC staff. The office serves the headquarters office and all regional office locations on matters including procurement and contracting, physical security, emergency management, property management, office lease acquisition and administration, space renovation, supplies and office equipment management, transportation, mail distribution, publications, printing and desktop publishing.
2. The Office of Human Resources has overall responsibility for the strategic management of the SEC’s humans. The office also represents the commission as the liaison to the US Office of Personnel Management and other federal agencies, various public and private-sector professional human resources organizations, and educational institutions in matters relating to human capital management.
3. The Office of Financial Management administers the financial management and budget functions of the SEC. The office assists the chairman and the executive director in formulating budget and authorization requests, monitors the utilization of agency resources, and develops, oversees, and maintains SEC financial systems. These activities include cash management, accounting, fee collections, travel policy development, and oversight and budget justification and execution.
Office of the General Counsel assumes overall responsibility for the establishment of agency policy on legal matters. The General Counsel serves as the chief legal advisor to the SEC chairman regarding all legal matters and services performed within, or involving, the commission, and provides legal advice to the commissioners, the divisions, the offices and other SEC components.
Office of Information Technology has overall management responsibility for the commission’s IT program including application development, infrastructure operations and engineering, user support, IT program management, capital planning, security, and enterprise architecture. The Office operates the Electronic Data Gathering Analysis and Retrieval (EDGAR) system, which electronically receives, processes, and disseminates more than 500,000 financial statements every year.
Office of Investor Education and Advocacy serves individual investors by seeing to it that their problems and concerns are known throughout the SEC and considered the first priority whenever the agency takes action. The office has four main functional areas:
- The Office of Policy and Investor Outreach has responsibility for reviewing all formal agency action from the perspective of the individual investor, including conducting investor surveys and focus groups. It plays a leading role in the commission’s efforts to ensure that investor disclosures are written in plain English, as well as the SEC’s technology initiatives such as providing increasingly more investor information in “interactive data” format.
- The Office of Investor Advocacy has responsibility for acting on investor tips, complaints and suggestions. Tens of thousands of investors contact the SEC each year using the commission’s online forms or its (800) SEC-0330 hotline (toll-free in US) to ask questions on a wide range of securities-related topics, complain about problems with their investments or their financial professionals, or suggest improvements to the agency’s regulations and procedures.
- The Office of Investor Education carries out the SEC’s investor education program, which includes producing and distributing educational materials, participating in educational seminars and investor-oriented events, and partnering with federal agencies, state regulators, consumer groups, industry associations and others on financial literacy initiatives. With the impending retirement of some 76 million Baby Boomers, one of the primary focuses of these educational efforts is the prevention of fraud against seniors.
- The Office of Public Documents answers public requests for information, including those under the Freedom of Information Act (FOIA) and executes the commission’s responsibilities under the Privacy Act. The office makes all of the SEC’s public records—including registration statements and reports filed by regulated companies and individuals, SEC decisions and releases, staff manuals, no-action and interpretive letters, and public comments on proposed rules—available through the Public Reference facilities located at SEC Headquarters.
Office of the Secretary houses the Secretary of the Commission, who is appointed by the chairman, and is responsible for the procedural administration of commission meetings, rulemaking, practice and procedure.
Office of Economic Analysis is the primary office of the chief economist who directs the activities of the Office of Economic Analysis. He or she is appointed by the SEC chairman to be the principal adviser to the commission on economics matters—including the SEC’s legal obligation to assess whether its regulations provide benefits to the nation’s investors and markets. The office advises the commission and its staff on the economic aspects of all SEC regulatory initiatives. The office periodically conducts studies on specific rules and engages in long-term research and policy planning on an ongoing basis. The office assists the commission in analyzing the incidence of investor harm in enforcement cases and evaluates market data and trends to assist in targeting enforcement, examination and inspection resources on the basis of relative risk.
Office of International Affairs promotes cooperation among national securities regulatory agencies and encourages the maintenance of high regulatory standards worldwide. The office assists the chairman and the commission in the development and implementation of the SEC’s international regulatory and enforcement initiatives. The office negotiates bilateral and multilateral agreements for commission approval on such subjects as regulatory cooperation and enforcement assistance and oversees the implementation of such arrangements. It is also responsible for advancing the commission’s agenda in international meetings and organizations. The office conducts a technical assistance program for countries with emerging securities markets that includes training both in the United States and in the requesting country. More than 100 countries currently participate in this program.
Office of Administrative Law Judges consists of independent judicial officers who conduct hearings and rule on allegations of securities law violations in cases initiated by the commission. When the commission initiates a public administrative proceeding, it refers the cases to the office, where it is assigned to an individual Administrative Law Judge (ALJ). The ALJ then conducts a public hearing that is similar to a non-jury trial in the federal courts. Just as a federal judge can do, an ALJ issues subpoenas, rules on motions, and rules on the admissibility of evidence. At the conclusion of the hearing, the parties submit proposed findings of fact and conclusions of law. The ALJ prepares an initial decision that includes factual findings and legal conclusions that are matters of public record. Parties may appeal an initial decision to the commission, which can affirm, reverse, modify, set aside or remand for further proceedings. Appeals from commission action are sent to a United States Court of Appeals.
Office of Equal Employment Opportunity works to ensure that the agency’s professional staff come from diverse backgrounds that reflect the diversity of the investing public. To maintain neutrality in resolving disputes, the EEO Office is independent of any other SEC office. The EEO director reports to the chairman. The primary mission of the EEO Office is to prevent employment discrimination, including discriminatory harassment, so that all SEC employees have the working environment to support them in their efforts to protect investors, maintain healthy markets and promote capital formation.
Office of the Inspector General conducts internal audits and investigations of SEC programs and operations. Through these audits and investigations, the Inspector General seeks to identify and mitigate operational risks, enhance government integrity, and improve the efficiency and effectiveness of SEC programs.
The Office of Risk Assessment (ORA) helps the SEC anticipate, identify, and manage risks, focusing on early identification of new or resurgent forms of fraud and illegal or questionable activities. ORA focuses on risk issues across the corporate and financial sector, including issues relevant to corporate disclosure, market operation, sales practices, new product innovation, and other activities of financial market participants. ORA analyzes information from a variety of sources, such as external experts, domestic and foreign agencies, industry and financial services, empirical data and other market data.
The Office of Public Affairs coordinates the agency’s relations with the media and the general public. The office also assists in the enforcement of the commission’s policy concerning the confidentiality of law enforcement and investigative information, which is designed to protect the privacy rights of American citizens. The office reviews and distributes within the agency press coverage of the SEC and of commission-related issues, including the securities industry and the financial markets. It also provides limited research where policy and public affairs goals overlap.
The Office of Legislative Affairs and Intergovernmental Relations
serves as the SEC’s formal liaison with Congress, other Executive Branch agencies, and state and local governments. The staff monitors ongoing legislative activities and initiatives on Capitol Hill that affect the commission and its mission. Through regular communication and consultation with House and Senate members and staff, the office communicates legislators’ goals to the agency and communicates the SEC’s own regulatory and management initiatives to Congress. The office is also responsible for responding to congressional requests for testimony of SEC officials, as well as requests for documents, technical assistance and other information. In addition, the office monitors legislative and oversight hearings that pertain to the securities markets and the protection of investors.
The Securities and Exchange Commission spent nearly $6.35 million on 896 contractors from 2000-2009. According to USASpending.gov, the SEC paid for a variety of services, from furniture to automatic data processing and telecommunications services, in support of its goals.
Top 10 Contractors
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Labat-Anderson Incorporated
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$37,995,103
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Garda World Security Corporation
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$35,408,735
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Compsci Resources, LLC
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$35,278,276
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Saic, Inc.
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$26,301,530
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Thomson Company Inc, The
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$15,952,089
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Gtsi Corp.
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$15,450,968
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Dell Inc.
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$15,373,900
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Reed Elsevier Group PLC
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$14,522,431
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Lockheed Martin Corporation
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$12,856,584
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Hewitt Associates, Inc.
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$11,949,369
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Labat-Anderson Incorporated, the SEC’s largest contractor, is a worldwide consulting firm specializing in information systems and services, environmental support and litigation services. For the SEC, it provides telecommunication services, including data storage on tapes and compact discs, basic research tools, and services including printing, duplicating, and bookbinding equipment.
Garda World Security Corporation, the SEC’s second largest contractor, provides consulting and investigation, pre-employment screening, physical security, cash logistics and online tools for employers and the insurance industry. For the SEC, this company provides “guard services.”
The SEC’s third largest contractor is a software engineering company that specializes in financial, legal and regulatory information technology for businesses, as well as federal, state and local government agencies. For the SEC, the company provides telecommunications services, including data storage, programming services and ADP systems analysis services.
The SEC’s fourth largest contractor is a scientific, engineering, and technology applications company that works in national security, energy and the environment, critical infrastructure, and health. For the SEC, the company provides telecommunication and technical assistance including the maintenance and repair of equipment.
The SEC’s fifth largest contractor recently merged with Reuters and now goes by the name of Thompson Reuters. The company provides critical information to leading decision makers in the financial, legal, tax and accounting, healthcare, science, and media markets. For the SEC, the company provides books, pamphlets and news and data services.
The SEC’s sixth largest contractor specializes in IT solutions and management consulting services. For the SEC, the company provides systems configuration, storage devices, equipment and software.
The SEC’s seventh largest contractor specializes in computer and related technology. For the SEC, the company provides computer hardware, software, technical support and systems configuration.
The SEC’s eight largest contractor delivers professional information, data, analysis and commentary in the science, medical, legal, risk information and analytics, and business sectors. For the SEC, the company provides books and pamphlets, other printed materials and access to data and information.
The SEC’s ninth largest contractor is a global security and information technology company that is the largest provider of IT services, systems integration and training to the US government. The majority of Lockheed Martin's business is with the U.S. Department of Defense and other U.S. federal government agencies. For the SEC, the company provides automatic data processing and telecom services.
The SEC’s tenth largest contractor is a human resources consulting firm that provides data and analysis in areas including healthcare, retirement and executive compensation practices. For the SEC, the company conducts special studies and analysis of management techniques.
SEC Hedge Funds Limits Stir Backlash
A February 2007 Los Angeles Times article revealed that the SEC had decided to sharply limit the number of Americans who can invest in hedge funds, triggering a public backlash. The commission proposed limiting participation in the investment vehicles to investors who have a minimum of $2.5 million in investable assets, excluding the value of their primary residence. Currently, investors must have at least $1 million in net worth, including real estate, or earn at least $200,000 a year. The change would restrict hedge funds to 1.3% of US households, down from 8.5%.
SEC Draws Fire for Decision to Ease Post-Enron Restrictions
In February 2007 the SEC began to take steps to protect corporations, executives and accounting firms from investor lawsuits that accused them of fraud. The first step involved the filing of a brief in the Supreme Court, urging the adoption of a legal standard that would make it harder for shareholders to prevail in fraud lawsuits against publicly traded companies and their executives. Critics claimed this was the SEC’s way of backing away from reforms that had been made in the wake of the 2001 Enron collapse, while proponents claimed that consolidation in the accounting industry had forced measures offering greater protection. The second measure involves bringing a case to the Supreme Court in order to interpret a provision of the Private Securities Litigation Reform Act of 1995, which sets out what investors must charge in a fraud lawsuit to prevent the case from being dismissed. In reinstating the case, the 7th US Circuit Court of Appeals in Chicago interpreted the law to mean that the investors had to show whether the accusations, if true, would permit “a reasonable person” to infer that the company and the executives “acted with the required intent.”
SEC Subpoenas Journalists
The SEC raised controversy when it issued subpoenas to Herb Greenberg of MarketWatch and Carol Remond of Dow Jones Newswires in 2006. The subpoenas were issued from the commission’s San Francisco office and compelled the journalists to hand over notes, telephone records, emails and other documents related to an investigation of alleged stock manipulation of online retailer Overstock.com. The journalists, who had both written stories critical of Overstock.com, believe the subpoenas were a form of harassment and trampled on their First Amendment rights.
SEC will try to avoid media subpoenas
(Associated Press)
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Founded: 1934
Annual Budget: $913 million
Employees: 3,473
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Securities and Exchange Commission
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Mary L. Schapiro, Barack Obama’s choice to chair the Securities and Exchange Commission, has taken over a demoralized agency that failed repeatedly to head off financial disasters involving Bear Stearns, Lehman Brothers and Bernard Madoff. Some observers consider Schapiro an experienced regulator who can’t help but do a better job than her George W. Bush-appointed predecessors, while others argue that having been a regulator the last few years is nothing to be proud of, and expect her to be a fox guarding the chicken coop.
One of four children, Schapiro was born on June 19, 1955, and grew up in Babylon, New York. Her father, Robert, was a printer and then ran an antiques shop. Her mother, Sue, a college librarian, is a cousin of the late Terry Sanford, who served as North Carolina’s Democratic senator and governor. Schapiro graduated from Franklin & Marshall College in Lancaster, PA, in 1977 with a bachelor’s degree in anthropology. In 1980 she earned a Juris Doctor degree from George Washington University.
Following law school, Schapiro worked as a trial attorney for the Commodities Futures Trading Commission (CFTC), eventually rising to counsel and executive assistant to chair Susan Phillips. She then left government and became vice president and counsel for the Futures Industry Association (FIA) in 1984, where she lobbied on behalf of merchants represented by FIA.
President Ronald Reagan chose Schapiro as a recess appointment in 1988 to fill one of two Democratic seats on the Securities and Exchange Commission. President George H. W. Bush reappointed her to the position in 1989, followed by President Bill Clinton selecting her to serve as acting chairman of the SEC for two months. Clinton then chose Schapiro to be chair of the Commodity Futures Trading Commission in 1994.
In 1996, she left the CFTC—much to the delight of derivatives traders who complained of Schapiro’s expanded regulatory efforts—and became president of regulation for the National Association of Securities Dealers (NASD). In charge of a new division, she joined NASD following a period of controversy over the association’s poor policing of traders in the Nasdaq stock market. She was promoted to vice chairman of NASD in 2002, and in 2006 she became NASD’s chairman and CEO. In this role she oversaw the association’s consolidation with NYSE Member Regulation to form the Financial Industry Regulatory Authority (FINRA), a nongovernmental, self-regulatory body for the securities industry. In 2006, as president of regulatory policy and oversight, she received compensation and benefits worth $2 million.
Among the questions that may arise at Schapiro’s confirmation hearing are those related to her decision in 2001 to appoint Mark Madoff, son of disgraced financier Bernard Madoff, to the board of the National Adjudicatory Council, the national committee that reviews initial decisions rendered in FINRA disciplinary and membership proceedings.
Some believe that Schapiro will push to merge her old agency, the CFTC, with her new one. Back in 1990, while serving on the board of the SEC, Schapiro publicly advocated for just such a move.
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Cox, Christopher
Previous Chair
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A native of St. Paul, Minnesota, Christopher Cox served as the 28th chairman of the Securities and Exchange Commission from June 2, 2005 until Goerg W. Bush left office. Cox received a bachelor’s degree from the University of Southern California in 1973, graduating magna cum laude after pursuing an accelerated three-year course. In 1977 Cox simultaneously received an MBA from Harvard Business School and a JD from Harvard Law School, where he was an editor of the Harvard Law Review. In 1977-78, he was law clerk to US Court of Appeals Judge Herbert Choy.
From 1978 to 1986, Cox specialized in venture capital and corporate finance with the international law firm of Latham & Watkins, where he was the partner in charge of the Corporate Department in Orange County, CA and a member of the firm’s national management.
From 1982-83, Cox took a leave of absence from Latham & Watkins to teach federal income tax at Harvard Business School. He also co-founded Context Corporation, the publisher of the English translation of the Soviet Union’s daily newspaper, Pravda. From 1986 until 1988, Cox served in the White House as senior associate counsel to President Ronald Reagan. In that capacity, he advised the President on a wide range of matters, including the nomination of three US Supreme Court Justices, reform of the federal budget process and the 1987 stock market crash.
Cox served as a Republican member of the House of Representatives from January 25, 1989 to August 2, 2005, representing a district in Orange County, CA. In 1994, he was appointed by President Bill Clinton to the Bipartisan Commission on Entitlement and Tax Reform.
Cox also served as co-chairman of the Bipartisan Study Group on Enhancing Multilateral Export Controls. For 10 of his 16 years in Congress, Cox served in the majority leadership of the House. He was chairman of the House Policy Committee; chairman of the Committee on Homeland Security; chairman of the Select Committee on US National Security; chairman of the Select Committee on Homeland Security (the predecessor to the permanent House Committee); chairman of the Task Force on Capital Markets; and chairman of the Task Force on Budget Process Reform.
In addition, Cox served in a leadership capacity as a senior member of every committee with jurisdiction over investor protection and US capital markets, including the House Energy and Commerce Committee (as vice chairman of the Oversight and Investigations Subcommittee); the Financial Services Committee; the Government Reform Committee (as vice chairman of the full committee); the Joint Economic Committee; and the Budget Committee.
In 1998, Cox headed the so-called Cox Committee, a House Select Committee that investigated the alleged Chinese acquisition of sensitive US technology. The “ Cox Report,” released in 1999, added to the furor at the time of purported Chinese espionage in the US nuclear weapons complex (the Wen Ho Lee scandal). The report alleged extensive Chinese spying in the United States and claimed that the country had obtained US nuclear bomb designs.
Early in the first term of President George W. Bush, Cox was appointed a federal appeals court judge, but withdrew after Sen. Barbara Boxer (D-CA) announced her opposition.
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