Dive Brief:

• Securities and Exchange Commission Chief Economist Jessica Wachter and General Counsel Megan Barbero are among the latest leaders at the agency to announce this week they will be departing their roles — joining SEC Chair Gary Gensler and Chief Accountant Paul Munter in a surging exodus of top leaders from the SEC, just days before President-elect Donald Trump’s inauguration on Monday.
• Gensler, who announced in November he would be leaving his role as SEC chair, is poised along with Barbero to depart the agency on inauguration day, while Munter will depart on Jan. 24. Wachter, meanwhile, left her role on Thursday, according to press releases.
• Gensler’s departure, as well as other leadership changes at the agency, come as the Trump administration is poised to take a more laissez-faire approach to enforcement and government regulation than the Biden administration. Trump’s nominee for Gensler’s successor, Paul Atkins, could potentially indicate a steep drop-off in enforcement actions under the new administration, CFO Dive previously reported.

Dive Insight:

In addition to Wachter and Barbero, the SEC is losing its Director of the Office of International Affairs YJ Fischer, Chief of Staff Amanda Fischer, and Policy Director Cory Klemmer, who also announced they would be stepping down from their respective roles, according to SEC press releases this week.

Barbero, YJ Fischer and Wachter each joined the agency in 2021 in their respective roles, according to press releases announcing their departures. Wachter joined the SEC in May 2021 as its chief economist and director of the division of economic and risk analysis (DERA) from the Wharton School of the University of Pennsylvania, where she will be returning, the SEC said.

Wachter “ably led a division that has a seat at the table for all of the SEC’s critical decision making, whether it’s policymaking, enforcement, or monitoring markets,” Gensler said in a statement included in the press release announcing her departure. “I have enjoyed and learned so much from working with Jessica who has been one of my closest advisors. I wish her very well as she returns to academia.”

Such personnel changes are not uncommon on the eve of new leadership, Michael Bachner, a partner at the law firm of Bachner & Associates, said.

“It’s not unusual when new administration comes into effect in any agency that individuals in leadership roles decide to exit,” Bachner, whose past experience includes serving as assistant DA for the New York County District Attorney’s Office, told CFO Dive via email. “It happens commonly, for example in the U.S. Attorney’s Office new leadership will often bring in individuals that they have relationships with and whose work they know.”

The departures at the SEC come as the agency leaders grapple with the dawn of Trump’s second term as president and the imminent arrival of an administration which has signaled a very different approach to government regulation than the Biden Administration.

Questions have swirled regarding how the SEC’s strategy will shift under SEC Chair nominee Paul Atkins — for example, how Atkins will treat the Public Company Accounting Oversight Board, a watchdog for the audit industry overseen by the SEC. The PCAOB could be defanged under Atkins, who is expected to have a looser hand when it comes to enforcement than his predecessor Gensler if confirmed.

The PCAOB could also see significant changes in leadership for the third time in as many administrations — with Atkins potentially performing the “full sweep” of the PCAOB’s board, Robert Pawlewicz, assistant professor of accounting at the Robins School of Business for the University of Richmond previously told CFO Dive.