SEC names new head of audit watchdog

McDonough will formally take charge of the Public Company Accounting Oversight Board, after a 'complete background check' is completed by the SEC.

The SEC will want to make no mistakes with McDonough's appointment. The previous chairman, William Webster, former head of the FBI, lasted just weeks in the job, after it emerged that he had been chairman of an audit committee of a technology company that was under federal investigation.

McDonough, though has an impeccable CV, having held his position at the NY Reserve Bank since 1993, prior to that he spent 22 years at First Chicago Corporation.

He will give up his role in New York when he assumes control of the PCAOB.

SEC chairman William Donaldson thanked acting chairman Charles Niemeier for the work he had done, and said in the case of McDonough, the SEC had found some one 'who not only meets the criteria outlined in the Sarbanes-Oxley Act, but who also lives up to the additional standards that we all agreed were important including independence and keen understanding of financial markets'.