Thursday, December 18, 2008 11:50 AM

Madoff Looms Over Regulator Rollout

By KEVIN FRIEDL

In his fourth press conference in as many days, President-elect Obama this morning rolled out three of his top financial regulators, including his nomination of Financial Industry Regulatory Authority CEO Mary Schapiro as chairwoman of the Securities and Exchange Commission. The announcement took place in the shadow of disgraced financier Bernard Madoff's alleged Ponzi scheme, a scandal Obama referred to repeatedly in his remarks.

Speaking to reporters at the Drake Hotel in Chicago, Obama introduced Schapiro along with Gary Gensler, his nominee to chair the Commodity Futures Trading Commission, and Daniel Tarullo, his choice for one of the two open spots on the Federal Reserve Board. Gensler served in the Treasury Department under Bill Clinton and, more recently, advised Hillary Rodham Clinton during her White house bid. Tarullo advised Obama on economic issues during the campaign and is the latest of several appointees to come from the Center for American Progress.

Praising his picks to oversee the country's shattered financial industry, Obama said they would help strengthen the county's regulatory apparatus, and he promised a "21st-century regulatory framework" that would foster "openness, accountability and transparency." He criticized the lack of regulation that he said had contributed to the country's current economic problems, saying the government had been "asleep at the switch."

But Obama also called for a "shift in ethics on Wall Street." "We can have the best regulators in the world, but everyone from CEOs to shareholders to investors are going to have to be asking themselves, not only is this profitable... but is it right?" he said.

When asked by one reporter whether the second half of the $700 billion bailout package should be released to help the Big Three automakers stay afloat, Obama effectively dodged the question, saying only that "Main Street can't afford" a collapse of the financial system.

Asked about his invitation of evangelical pastor Rick Warren, whose views on social issues are opposed by gay rights groups, to participate in the inauguration, Obama reached back for an old campaign chestnut about Americans needing to be able to "disagree without being disagreeable." He also reaffirmed his disagreements with Warren, calling himself "a fierce advocate for equality for gay and lesbian Americans."