According to a Wall Street Journal report, Webster almost immediately after his appointment found himself embroiled in a controversy that embarrassed the White House and sparked the resignation last week of US Securities and Exchange Commission (SEC) Chairman Harvey Pitt, who continues to serve during the search for his successor.
The SEC, Congress, and the General Accounting Office are examining why Pitt hadn’t informed the other four SEC commissioners before Webster’s accounting board confirmation vote that. Webster once led the audit committee of a company the SEC has been informally investigating, the Journal said. (See Pitt Wants Probe of Accounting Board Selection Process ).
The company’s chief executive has been accused of accounting improprieties and shareholder fraud.
“I now believe my continued presence on the board will only generate more distractions, which will not be helpful to the important mission of the board,” Webster said in his resignation letter to Pitt. “Those who know me will appreciate that I do not abandon duty lightly. It is time to clear the air.”
The SEC “will move expeditiously to name a new chairman of the Public Company Accounting Oversight Board,” an SEC spokeswoman told the Journal.
The agency now has neither a permanent chairman nor a chief auditor, who also resigned over the Webster appointment, and now the new accounting board lacks a leader, as well.
The board was created over the summer by Congress to oversee changes in the accounting industry following scandals involving Enron Corp., WorldCom Inc. and other corporations.