NASD Board Approves New Divisional Structure; Extends Term of Chairman and CEO Robert Glauber
Washington, D.C. — NASD, the leading self-regulatory organization for the securities industry, announced today that its Board of Governors has approved a new divisional structure, which reflects NASD's singular regulatory focus on investor protection and market integrity as a result of its planned separation from both The Nasdaq Stock Market and the American Stock Exchange. The Board also extended the term of NASD Chairman and CEO Robert R. Glauber to five years.
"With our ownership of markets becoming a thing of the past, NASD has evolved into a fully independent organization with its focus entirely on financial regulation," Glauber said. "This new structure serves and makes plain our overriding mission to bring integrity to the markets and confidence to investors. The streamlined new organization will help all NASD professionals work together effectively towards this single unifying purpose. These strategic changes are evolutionary -- yet they are also essential."
Glauber also said the NASD Board approved additional resources to expand enforcement efforts in light of both the new analyst conflict rules approved by the SEC and the USA PATRIOT Act passed by Congress last fall.
In the new organization, NASD will have three operating divisions: Regulatory Policy and Oversight, with primary responsibility for rule making, member regulation, market surveillance and enforcement; Regulatory Services and Operations, with responsibility for NASD's market operations and information systems, technology, the Central Registration Depository (CRDSM), international activities and member services, including education and training products; and Dispute Resolution, with responsibility for arbitration and mediation of investor and industry disputes. Schapiro's division will be responsible for offering NASD's regulatory services to U.S. markets, and Shulman's to markets internationally.
Mary L. Schapiro, who has served for the last six years as President of NASD Regulation, will head Regulatory Policy and Oversight. Schapiro, who previously served as a Commissioner of the Securities and Exchange Commission and as Chairman of the Commodity Futures Trading Commission, has also been named NASD Vice Chairman. Douglas Shulman, who has been responsible for a variety of NASD services, technology and corporate development initiatives for the last 18 months, has been named President of Regulatory Services and Operations. Shulman also will continue to lead NASD's corporate development efforts. Linda D. Fienberg, the current head of NASD Dispute Resolution, will continue to oversee the leading securities dispute resolution forum for investors and member firms.
Glauber said he had asked Schapiro, Shulman and Michael D. Jones to join him in forming a Management Committee to provide overall strategic direction and operational guidance for NASD. Jones, who was promoted to Senior Executive Vice President and will continue to serve as Chief Administrative Officer, will also take on some added responsibilities for overseeing strategy and research.
Glauber said that NASD's divisional structure would go into effect immediately. NASD will seek approval from its membership this summer for the bylaw changes needed to officially consolidate the existing subsidiaries. "With this new structure, we will be able to fulfill our regulatory mandate in an even more agile and efficient manner that will advance our mission and make NASD an even better organization," he said.
Commenting on the appointment of Schapiro as NASD Vice Chairman, Glauber said, "Mary is uniquely qualified to head Regulatory Policy and Oversight and play a key role in shaping NASD's strategic direction. Her appointment as Vice Chairman recognizes her work at the CFTC, the SEC and NASD, through which she has developed unparalleled expertise in the field of securities regulation and earned a well-deserved reputation for professional integrity. Her new positions underline NASD's continuing commitment to tough, even-handed regulation."
"With the changes we are making, NASD will be more fully integrated in its overall approach, from rule making, compliance and enforcement, to professional development, qualification and dispute resolution," Schapiro said. "Given our unified mission and focus, it's important that we unify our expertise, personnel and resources, as well."
In support of the changes announced today, NASD also unveiled a new logo and word mark, underscoring its visual as well as operational independence from Nasdaq. The new logo consists of a unique font spelling out "NASD" juxtaposed with an upward sweeping "data stream," representing both the increasingly technological nature of NASD's work and the positive effect of sound regulation on the markets. Emphasizing its core mission, NASD has also adopted the tagline, "Investor protection. Market integrity."
NASD is the leading private-sector provider of financial regulatory services, dedicated to bringing integrity to the markets and confidence to investors through effective and efficient regulation and complementary compliance and technology-based services. NASD touches virtually every aspect of the securities business -- from registering and educating all industry participants, to examining securities firms, enforcing both NASD rules and the federal securities laws, and administering the largest dispute resolution forum for investors and member firms. For more information, please visit our Web site at www.nasd.com.