Securities and Exchange Commission Chairman Gary Gensler announced the removal of William Duhnke as chairman of the Public Company Accounting Oversight Board, and named Duane M. DesParte as acting chairman, the regulator said in a statement Friday.
The PCAOB was established by a 2002 law passed in the wake of the Enron collapse, which also led to the failure of Arthur Andersen, in order to create more oversight of accounting firms that audit public-company financial statements.
“The PCAOB has an opportunity to live up to Congress’s vision in the Sarbanes-Oxley Act,” said SEC Chairman Gary Gensler. “I look forward to working with my fellow commissioners, Acting Chair DesParte, and the staff of the PCAOB, to set it on a path to better protect investors by ensuring that public company audits are informative, accurate, and independent.”
The SEC also announced that it “intends to seek candidates to fill all five board positions at the PCAOB.”
Progressive Democrats have been pushing for Gensler to remove all Trump-appointed members of the PCAOB, with Sen. Elizabeth Warren of Massachusetts and Sen. Bernie Sanders of Vermont sending a letter to Gensler last week calling the SEC head to “immediately remove and replace the members of the Public Company Accounting Oversight Board.”
“We ask that you make full use of these authorities to undo the Trump administration’s damage and begin the serious work of rebuilding the PCAOB. This must start with a clean slate and a new direction in leadership,” the lawmakers wrote.
In 2017, President Trump’s SEC chairman, Jay Clayton, made a similar move, removing Obama-era appointees and naming five new board members.
The two Republican-appointed SEC commissioners, Hester Peirce and Elad Roisman, protested Gensler’s in their own statement.
“Although the Commission has the authority to remove PCAOB members from their posts without cause, in all of our actions, we should act with fair process, fully-informed deliberation, and equanimity, none of which characterized the Commission’s actions here,” they wrote. “A future in which PCAOB members are replaced with every change in administration would run counter to the Sarbanes Oxley Act’s establishment of staggered terms for Board members, inject instability at the PCAOB, and undermine the PCAOB’s important mission by suggesting that it is subject to the vicissitudes of politics. “