	new leader coming to u s sec in challenging era president reagan s nominee as top policeman for the nation s securities markets will inherit an agency challenged by an insider trading scandal wild stock price gyrations and a host of uncertainties stemming from the globalization of financial markets david ruder a year old republican law professor at northwestern university in evanston ill was named thursday to be the rd chairman of the five member u s securities and exchange commission if confirmed by the senate as expected he will succeed john shad who left the agency earlier this week after a record six years as chairman to become ambassador to the netherlands the sec has been in the limelight for the past year as its investigators have probed into the most colossal insider trading scandal ever uncovered on wall street the investigation which is still active mushroomed in recent months as a growing number of well known traders and prominent investment banking firms have been charged with wrongdoing the pace of the probe picked up markedly in november after ivan boesky one of wall street s most successful stock speculators agreed to cooperate with government investigators and to pay a record mln dlrs in penalties and illegal profits after being charged with insider trading but the agency is also wrestling with a vexing new phenomenon of huge and rapid swings in stock prices spurred by computer driven trading strategies that span markets in securities options and futures the price gyrations have combined with rising trading volumes to bring unprecedented volatility to some u s securities markets at the same time the sec is being pressed by some lawmakers to put a stop to abusive tactics in corporate takeover contests as an unrelenting wave of such takeovers steadily reshapes the u s corporate landscape and the agency is being pushed by u s and foreign exchanges intent on expansion to lay the regulatory groundwork for an international securities marketplace in which trading occurs across borders throughout the world around the clock such worldwide trading networks offer vast new investment opportunities but could strain the sec s ability to enforce u s securities laws and guard investors from fraud under the leadership of shad the sec eased financial disclosure requirements for publicly traded companies eliminated many minor investor protection rules attempted to spur competition among exchanges and streamlined the agency s review of hostile corporate takeovers shad who had been vice chairman of the e f hutton investment banking firm brought a wall street perspective to the agency upon being named chairman in in line with the views of other top administration officials he favored marketplace determination of takeover battles over new federal regulations the sec under shad also stressed prosecution of insider trading violations over the corporate wrongdoing cases that topped the agency s enforcement agenda during the administration of president jimmy carter a democrat securities lawyers and industry officials uainted with ruder say the new chairman designate is unlikely to significantly alter the commission s current priorities the sec currently has about employees most of them lawyers and an annual budget of about mln dlrs though that figure likely will be significantly higher next year as the agency moves to beef up its enforcement staff the agency is one of the few in the government that actually has taken in more money than it has spent in the past few years because of fees it charges public companies investment banks and other securities firms it regulates the sec is structured as an independent regulatory agency meaning that its five commissioners are appointed by the president to fixed five year terms and protected from firing for policy differences alone by law no more than three commissioners may be of the same political party and the agency prepares its own budget request each year instead of leaving this to the white house established by congress in the sec traces its origins to the great stock market crash of which was attributed in large part to widespread trading on credit and attempted market manipulations by large investment firms the agency requires public companies and investment vehicles such as mutual funds to issue periodic reports on their financial condition and to disclose changes in their condition any time they issue new securities it requires brokers dealers and investment banks to register with it and comply with investor protection rules and it polices exchanges and regulates trading practices its first chairman was joseph kennedy an industrial magnate who was also the father of john kennedy later to become the nation s th president other former chairmen include william douglas who served from until his appointment to the u s supreme court in and william casey who served during president nixon s first term and was reagan s director of the central intelligence agency until his death earlier this year reuter 
