[ by Melanie Gretchen ]

President Obama nominated Morgan Stanley CFO Ruth Porat to serve as deputy Treasury secretary and serve under Jack Lew, who left Citigroup as Treasury Secretary-nominee.  Ms. Porat's nomination created enormous anticipation, based on her successful tenure as CFO at Morgan Stanley, that began 2010. 

However, early into the nomination process, Ms. Porat advised the White House that she was withdrawing her name for consideration as deputy Treasury secretary.  Mr. Porat reportedly did not want to face questions about her finances and was worried about a highly charged environment in Washington against Wall Street bankers.  She watched as Jack Lew was grilled about his work at Citigroup and the sizable compensation he pulled down.

While Ms. Porat's exact net worth is not known, it is public knowledge that her compensation for 2011 exceeded $10 million. During his confirmation, Mr. Lew divulged details of his compensation at Citigroup (worth as much as $500,000 that had been previously granted to him but had not yet vested was awarded to him because he left the firm for a senior government position).

Prior to Inspection of Tax Returns.   Ms. Porat's departure came even before her tax returns to the White House were subject to inspection, i.e. she will get to keep her Wall Street standing and her pride.  Speculation of who would succeed her at Morgan Stanley will be replaced by who will replaced by who will succeed her as deputy Treasury front-runner.  Current rumored candidates include Mary Miller, a top Treasury official, and Lael Brainard, the under secretary of the Treasury for international affairs.  If the White House chooses a candidate already in the administration, that person will sidestep, at least temporarily, a confirmation hearing.

For further details, go to [Dealbook, 3/28/13].

To contact Melanie Gretchen: melanie@compliance-insights.com.