They say everything comes full circle in due time, and that is certainly the case with the career of Andrew “Buddy” Donohue. In a revolving door redux, Donohue announced on Thursday that he will be resigning his position at Goldman Sachs to return the SEC where he previously served as head of investment management regulation from 2006 to 2010.
Donohue had been the top attorney in Goldman Sachs’ asset management unit, but will be leaving the bank to become the top aide to U.S. Securities and Exchange Commission Chair Mary Jo White, according to a statement released by the agency Thursday afternoon. Political analysts say that Donohue’s appointment will add an industry veteran to White’s staff as the agency fends off questions regarding its oversight of the asset management industry.
In his move to the SEC, Donohue will take over for Lona Nallengara, who will be resigning next month after serving as White’s chief of staff for two years. Donohue will begin his position at the agency in the first week of June.
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Statement from SEC Chair Mary Jo White
“Buddy is a seasoned professional whose previous SEC and private-sector experience will be invaluable in advancing all aspects of the agency’s mission,” SEC Chair Mary Jo White commented in a statement. “His deep knowledge of asset management will be especially useful as the commission advances its rulemaking agenda for addressing potential risks in asset management and considers a uniform fiduciary standard.”
More on Andrew “Buddy” Donohue
Donohue was employed as the general counsel of Goldman Sachs’ asset-management division. Of note, SEC Chair White has put forth a regulatory agenda that further regulate how mutual funds manage derivatives and other less liquid assets. Some regulators believe large asset managers could threaten financial stability and should be more closely overseen.
Before his four years at the SEC, Donohue was the global general counsel of Merrill Lynch Investment Managers from 2003 to 2006. He was also a partner in the investment management practice of Morgan Lewis & Bockius, based on information in the SEC statement.
Statement from critics of Washington – Wall Street revolving door
The revolving door where executives move back and forth between Washington and Wall Street is spinning at high speed these days, and critics argue the endemic practice gives the financial industry too much say over the rules of the game.
“The revolving door and the pernicious outsized influence Wall Street has over elected officials, policy makers and regulators are seriously eroding confidence of the American people in its own government and democracy itself,” Dennis Kelleher, president of Better Markets, a group advocating for tighter regulation of Wall Street, noted. “This hire will only feed that cynicism.”