FINRA Board Launches Search to Replace Schapiro

The Board of Governors of the Financial Industry Regulatory Authority (FINRA) said it has established a search committee to find candidates to replace FINRA CEO Mary L. Schapiro, set to become chairman of the Securities and Exchange Commission (SEC).

Shcapiro’s nomination to serve as head of the SEC was approved by the U.S. Senate yesterday. Her service as FINRA’s CEO ends at close of business Friday, according to a release from FINRA. Stephen Luparello, FINRA’s senior executive vice president for Regulatory Operations, will serve as Interim CEO while the board committee conducts its search for a permanent CEO.

Luparello has been with FINRA and its predecessor organization, NASD, since 1996, the release said. Prior to joining FINRA, he served in various capacities at the Commodity Futures Trading Commission and the SEC.

FINRA’s Board has also accepted the resignations of two board members representing large securities firms, the agency said. Robert MCann left the Board when he resigned recently from Merrill Lynch (see “McCann Exits Merrill after Bank of America Takeover). Lehman Brothers’ Thomas Russo vacated his board seat when his firm underwent organizational changes and, as a result, no longer qualifies as a large firm because it now has fewer than 500 brokers.

The board is expected to nominate two new large firm board candidates in February. Following formal publication of those nominations on FINRA’s website, the more than 180 registered large firms will have the opportunity to nominate additional candidates by petition. If no additional candidates are nominated within 45 days, the board’s nominees will take office. If additional candidates are nominated, a vote by large firms will take place in accordance with FINRA’s By-Laws, according to FINRA.