Champ to leave the SEC(2)

Norm Champ, who was instrumental in the adoption of the Volcker Rule, will leave the financial watchdog later this month.

Norm Champ will leave the Securities and Exchange Commission (SEC) after more than two years working as the director of the division of investment management .

Champ was a key decision maker on the SEC’s adoption of the Volcker Rule, with a focus on the provisions governing “covered funds”.

The Volcker Rule prohibits banks from proprietary trading and acquiring ownership interests or sponsoring such “covered funds”, including private equity and hedge funds. The regulation also affects banks’ holdings in CLOs – securitized vehicles that are largely backed by commercial loans. 

Champ's division of investment management would also be responsible for any controversial rulemaking on the designation of private equity firms as broker-dealers, a debate which raged last year. The argument made by the SEC in favor of such a notion was that private fund personnel dedicated to selling fund interests, say a marketing team, are technically brokers when their compensation is tied to the outcome or size of the securities transaction.

While in his role as director of the SEC’s investment management team, Champ also created the “Senior Level Engagement Program” where his team meets with senior management of large asset management firms as a way of improving the commission’s awareness of emerging issues in the industry.

“His efforts on important rulemakings and the organizational changes he has put in place will leave a lasting mark on the Commission,” said in a statement SEC Chair Mary Jo White.

Before taking over as head of the division in 2012, when Eileen Rominger left, Champ was deputy director of the SEC’s office of compliance inspections and examinations (OCIE). In that role, he was instrumental in the restructuring of the agency’s national exam program.

Champ will leave the agency before the end of January to become a visiting scholar for Harvard Law School’s spring semester, where he also is a lecturer in law teaching a course on investment management law.