Jay Clayton has announced that he will step down as chair of the Securities and Exchange Commission (SEC) at the end of the year, six months before the end of his term. It’s common for chairs of the SEC to step down when a new president enters office.
Jay Clayton as SEC chair
Jay Clayton has served as head of the SEC for the last three and a half years, overseeing many big changes in the financial markets, according to CNBC. During his tenure, the agency raked in some $14 billion in agreements and fines with those found to be in violation of regulatory standards, including $4.68 billion in fiscal 2020, which is a record.
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Although some criticized Clayton for supposedly being too easy on corporate America, his tenure included a large number of enforcement actions. One of the agency's enforcement actions was against Tesla CEO Elon Musk, who had to step down as chairman and pay a fine of $20 million due to tweets he sent about supposedly taking the company private, which never happened.
Interim chair to be appointed
The markets have gotten more and more automated and complex, and the SEC has been seen as a referee to prevent the glitches that became common earlier in the decade. Jay Clayton said that the capital markets in the U.S are "the strongest and most nimble in the world," and the SEC has improved protections for investors, "promoted capital formation for small and larger businesses, and enabled our markets to function more transparently and efficiently."
President Trump will nominate an interim chair of the SEC. According to CNBC, former Manhattan U.S. Attorney Preet Bharara could succeed Jay Clayton as chair of the SEC. Reuters reports that Senior Democratic SEC Commissioner Allison Lee will probably be named as acting chair of the agency until the new chair is appointed.
Clayton has said he wants to return to New York, and Trump had announced plans to nominate him as the next U.S. attorney for the Southern District of New York. However, Geoffrey Berman refused to step down from the position, and his deputy ended up replacing him.