Decision Addresses Conflicts of Interest Concerns.

[ by Howard Haykin ]

The SEC - believing "two heads are better than one" and that abundant leadership in enforcement is a regulator's dream - announced Monday that Acting Director George Canellos and former federal prosecutor and current Debevoise partner Andrew Ceresney have been named Co-Directors of the Division of Enforcement. 

Conflicts of Interest Leading to Recusals.   SEC Chairman Mary Jo White and Enforcement Director Andrew Ceresney both served as partners at Debevoise & Plimpton prior to joining the SEC, and they frequently teamed up on client engagements.  This bodes well for operating efficiencies at the SEC, but it also means that on certain significant enforcement cases Ms. White and Mr. Ceresney will both have to recuse themselves - i.e., where respondents are former Debevoise clients, including several large global banks and their executives.

That's where having Mr. Canellos, 48, as Co-Director pays off.  Having served as Acting Director since January 2013, and previously serving as the division’s Deputy Director since June 2012, Mr. Canellos has the experience to fill the leadership gap. 

Recently, Mr. Canellos played a key role in developing Enforcement's Cooperation Program and in generating numerous programmatic, policy, and legislative initiatives and critical decisions on national priority enforcement actions.

Prior to joining SEC Enforcement, Mr. Canellos served as Director of the SEC’s New York Regional Office from  July 2009 to June 2012.  There, he oversaw 400 enforcement attorneys, accountants, investigators, and compliance examiners involved in the investigation and prosecution of enforcement actions and the performance of compliance inspections in the New York region.  The New York office has the largest concentration of SEC-registered financial institutions, including more than 4,000 investment banks, investment advisers, broker-dealers, mutual funds and hedge funds.

Andrew Ceresney's Professional Profile.   Mr. Ceresney, 41, served as a Deputy Chief Appellate Attorney in the U.S. Attorney's Office for the Southern District of New York, where he was a member of the Securities and Commodities Fraud Task Force and the Major Crimes Unit.  As a prosecutor - working under Mary Jo White's leadership, Mr. Ceresney handled numerous white collar criminal investigations, trials and appeals, including matters relating to securities fraud, mail and wire fraud, and money laundering.

As noted above, Mr. Ceresney leaves the law partnership of Debevoise & Plimpton LLP, where he focused on representing entities and individuals in white collar criminal and SEC investigations, complex civil litigation and internal corporate investigations. 

Mr. Ceresney served as a law clerk to the Honorable Dennis Jacobs, Chief Judge of the U.S. Court of Appeals for the Second Circuit from 1997 to 1998. He served as law clerk to the Honorable Michael Mukasey, formerly Chief Judge of the U.S. District Court for the Southern District of New York, from 1996 to 1997. Mr. Ceresney is a graduate of Columbia College and Yale Law School.

For additional information, go to C-I's previous story announcing Mr. Ceresney's appointment, go to:  [ "New SEC Enforcement Chief Will Be …", posted 4/19 in WHO's News ].

Additional Profile of George Canellos.   A former federal prosecutor, Mr. Canellos became an Assistant U.S. Attorney in the Southern District of New York in 1994. During his nine years there, Mr. Canellos served in a number of positions including Chief of the Major Crimes Unit, Senior Trial Counsel of the Securities and Commodities Fraud Task Force, and Deputy Chief Appellate Attorney. After leaving the U.S. Attorney’s Office and before joining the SEC, Mr. Canellos spent more than six years as a litigation partner at the law firm of Milbank, Tweed, Hadley & McCloy LLP. He began his legal career as a litigation associate at Wachtell, Lipton, Rosen & Katz. Mr. Canellos is a graduate of Harvard College and Columbia University School of Law.

[ SEC Press Release 13-67, 4/22/13 ]

To contact the Writer:  Howard@Compliance-Insights.com.