SEC Names Ex-GSAM Investment Head

(January 19, 2011) — The Securities and Exchange Commission (SEC) has announced that Eileen Rominger, previously the global chief investment officer at Goldman Sachs Asset Management, has been named its Director of Investment Management in charge of protecting investors and promoting capital formation through oversight and regulation of the investment management industry.

Rominger, set to begin her work at the agency in February, is replacing Andrew J. “Buddy” Donohue, who left the SEC unit, responsible for a string of pay-to-play investigations, in November. The appointment reflects the continued efforts by the US regulatory agency to protect investors, as “retirement and other important financial needs loom large for millions of Americans, even as investment choices increase in number and complexity,” Rominger noted in a statement.

“Eileen brings the agency a lifetime of experience in the asset management industry and a record of strong leadership,” said SEC Chairman Mary L. Schapiro in a statement. “She understands the importance of the nation’s investment management industry to the well-being of investors everywhere.”

Ironically, Rominger’s former company paid $550 million last year to settle a civil fraud suit brought by the SEC. “This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing,” Robert Khuzami, director of the SEC’s Division of Enforcement, said in a statement in July of last year. The charges, filed April 16, had pushed the firm’s market value down by more than $25 million at one point. More recently, a Goldman unit that invests on behalf of asset owners turned down an opportunity to invest capital in social network Facebook, raising questions over whether the bank’s eventual investment is a robust one. Rominger, however, was not involved in either case.