[ by Howard Haykin ]

SEC Chairman Mary Jo White begins the critical step of hand-selecting the Directors of the various SEC Divisions.  It appears likely that she would fill the Agency's Trading and Markets Division, first, according to several people who are close to the discussions and asked not to be named.

Ms. White, a former federal prosecutor and partner at Debevoise & Plimpton, was sworn into the SEC Wednesday as its new chairman.  Although little is known yet about her views on market structure regulatory policy, Ms. White told lawmakers during confirmation hearings that she wanted to examine computer-driven and high-speed trading to see whether any new rules were needed to protect investors, adding:  "There must be a sense of urgency brought to addressing these issues to understand their impact on investors and the quality of our markets so that the appropriate regulatory responses can be made."

Search For Trading & Markets Division Director.  One source familiar with the SEC's thinking said that White was intent on finding people with experience in the securities industry to run the division.  That person said:  "The people they've had have been reasonable people, good lawyers, but not industry people. And so what ends up happening then is the staff rules the roost - they have them at their mercy because they know the facts."

So far, two names have been mentioned for the SEC short list - Joseph Lombard and Chris Concannon. 

Joseph Lombard, a market structure expert at law firm Murphy & McGonigle, is considered the leading candidate for the position.  Mr. Lombard financial career experience also includes time spent with: 

• Nasdaq OMX, where Lombard was on the executive team at Archipelago Holdings and served as president of the company's electronic brokerage subsidiary.
• Merrill Lynch, where Lombard was a managing director in the global equities division.
• The SEC, from 1999 to 2001, where Lombard served as a senior counsel to Chairman Levitt.

Chris Concannon is a former Nasdaq OMX Group executive who now works for high-frequency trading (HFT) firm Virtu Financial LLC.  He is a partner at Virtu Financial LLC, which attempted but to buy Knight in December - but lost out to rival Getco Holding Co.  Concannon also has spent time during his financial career with:

• At the SEC, from 1994 to 1997, Concannon served as a staff attorney.
• At Instinet Clearing Services, Island ECN, Nasdaq OMX Group, Concannon served in senior level positions.

A big issue with Concannon, according to a Wall Street Journal report, is that Concannon reportedly has told his fellow partners at Virtu Financial that it is unlikely he'd leave his current post at that firm. 

Busy Agenda At The Trading and Markets Division.    The Division currently is working to complete new rules for the $640 trillion OTC derivatives industry.  It also is concurrently tackling major changes in the equity markets structure.  John Ramsay serves as the Division's Acting Director.

For further details, go to [Reuters, 4/12/13].