SEC's senior commissioner to resign March 31 after disputes with chairman

March 27, 1992|By Dow Jones News Service

WASHINGTON -- Edward Fleischman, the Securities and Exchange Commission's senior commissioner, announced yesterday that he plans to resign from the agency Tuesday.

Mr. Fleischman, who has served at the SEC since 1986, will become a partner in the New York-based law firm Rosenman & Colin. His term was scheduled to expire in June.

In recent months, Mr. Fleischman has frequently sparred with SEC Chairman Richard C. Breeden. He has charged that the SEC, under Mr. Breeden's leadership, has prevented commissioners from airing dissenting views.

"I've been here too long," Mr. Fleischman told reporters. He said he has seen the "diminishment of my role and that of other commissioners."

Mr. Fleischman announced his resignation a few hours after sending an extraordinary letter to the Senate securities subcommittee that took issue with testimony prepared by Mr. Breeden on the agency's small-business initiative.

In the letter, Mr. Fleischman said he agreed with Mr. Breeden's goal of helping small businesses raise capital but that the plan "falls far short of any real effort to eliminate" unnecessary regulatory costs for small companies.

Mr. Fleischman told lawmakers that he was forced to write the letter because he was not permitted to attach a footnote or brief to Mr. Breeden's testimony outlining his views.In recent weeks, Mr. Fleischman has frequently charged that he has been shut out of the SEC decision-making and prevented from airing his opinions.

During a news conference this afternoon,Mr. Fleischman declined to criticize Mr. Breeden personally, opting instead to fault the direction the SEC has taken in recent months. He said the agency has sought and obtained too much regulatory and punitive authority.

"I'm concerned with the concentration of power," he said. "It's the kind of 18th Century view that you don't want to have too much power anywhere."

"I'm the last of the Reaganauts here, and I'm not ashamed of it," Mr. Fleischman said. "I really believe in the removal of regulatory costs when you can do it."

Mr. Fleischman contended that regulators should seek to promote liquid markets and avoid putting "sand in the gears."

He criticized Mr. Breeden's opposition to a New York Stock Exchange proposal to relax listing requirements for foreign companies, arguing that investors should be allowed to invest in foreign enterprises.

Mr. Breeden has maintained that loosening listing standards for foreign companies would compromise investor protection and put U.S. companies at a competitive disadvantage.

Mr. Fleischman countered that it was unlikely that the stock of a large foreign enterprise like Royal Dutch-Shell could be manipulated, adding: "Do we want to keep those people away?"

Mr. Fleischman said he would have liked to resign two years ago but that his wife's illness made it impossible for them to leave the area. He said his wife is now strong enough to return to their home in New Jersey.

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