Women Executives in Security Intermediary Firms

Wei Christianson
China Chief Executive
MORGAN STANLEY
CHINA DEAL maker Wei Christianson has proved her loyalty to Morgan Stanley's chief executive officer, John Mack. Now she has to prove her mettle to the Wall Street firm.

The Beijing native followed Mr. Mack from Morgan Stanley to Credit Suisse in 2002 and left days after Mr. Mack was pushed out of the Swiss bank in 2004. She rejoined her mentor at Morgan Stanley earlier this year, leaving Citigroup, where she had been head of investment banking in China.

Her move back to Morgan Stanley spurred the departure of several longtime China bankers at the company who weren't happy with her return. Still, Ms. Christianson -- who has impressed fans and detractors alike with her toughness and tenacity in getting deals done -- has been undeterred in her mission to build a long-term presence for Morgan Stanley in the world's fourth-largest economy across all the firm's products and services. It's a task she describes as "very challenging."

One hurdle Ms. Christianson faces: finding a way to access the domestic equities market. Although Morgan Stanley owns a 34% stake in domestic investment bank China International Capital Corp., it cannot underwrite or trade domestic stocks on its own. As the government pushes to develop local markets, Morgan Stanley, like other Wall Street firms, is pushing for greater access. The firm recently bought a bank license that will permit it to sell fixed-income and derivative products.

Ms. Christianson likes to break through barriers. In 1983, she was the first student from China to graduate from Amherst College, which then awarded her a full scholarship to attend Columbia University's law school. After working for a law firm for two years in New York, she moved to Hong Kong to work for the city's securities watchdog. From there, she moved into banking.


Mary Schapiro
Chairman and Chief Executive
NATIONAL ASSOCIATION OF SECURITIES DEALERS
SHE MADE her career as a tough cop on Wall Street. But in September, Mary Schapiro took over as chairman and chief executive of the National Association of Securities Dealers, just as the enforcement winds were changing.

After years of pressure for heftier fines, investor disputes in arbitration at the NASD have been declining, along with Securities and Exchange Commission enforcement actions. Defendants are winning some securities cases. Companies concerned about the tough rules implemented in recent years are starting to bypass U.S. markets.

The new post, and climate, give Ms. Schapiro a chance to make critical investor-protection decisions 10 years after she arrived at the industry-funded regulator of brokers and exchanges. Among her priorities: handling surveillance more efficiently and using technology to identify areas where investors may be at most risk of getting harmed.

"The pace of new regulation is ebbing," says Ms. Schapiro, who is 51 years old. The Washington-based NASD is looking over past rules to make sure they're working, and in September clarified that penalties should take into account a firm's size. The NASD, which sets and enforces rules for 5,200 brokerage firms, also has been discussing a merger of some brokerage-firm regulatory operations with the New York Stock Exchange.

In coming years, Ms. Schapiro plans to use NASD's $600 million annual budget in large part to protect and educate the growing number of retirees investing. NASD is also focusing on investment-like insurance products, low-priced "penny" stocks and energy scams.

A former Commodity Futures Trading Commission chairman and SEC commissioner, Ms. Schapiro says she decided to get into regulation as a law student when she saw silver prices surging amid alleged manipulation.

In her first few months in her new job, to increase transparency, Ms. Schapiro has given more than half a dozen speeches. "I kind of overdid it," she says.


Linda Chatman Thomsen
Director of Enforcement
SECURITIES AND EXCHANGE COMMISSION
IN HER FIRST YEAR as chief of the Securities and Exchange Commission's enforcement division, Linda Chatman Thomsen has had her mettle seriously tested.

Known for maintaining an optimistic outlook while refusing to compromise her values in investigations, Ms. Thomsen has had to adjust to a new SEC chairman. She faced criticism from Congress on the effectiveness of the SEC's insider-trading program. And she had to deal with a Government Accountability Office probe of the division's policies and practices, which grew out of a complaint from an ex-employee.

If that weren't enough, the 52-year-old former federal prosecutor found herself in the public spotlight after her staff sent subpoenas to journalists while investigating possible market manipulation. SEC Chairman Christopher Cox, Ms. Thomsen's boss, issued a statement that was widely seen as a public rebuke of the division. Ms. Thomsen took responsibility for the subpoenas, evoking the support of her staff.

Ms. Thomsen has split her time in private practice and in the public sector, first as a federal prosecutor before she joined the SEC in 1995. There, she was selected to handle complex cases, including Enron. In May 2005, she became the first woman to lead the division.

In the coming year, her challenge will be to manage the burgeoning stock-options backdating scandal and decide which executives to formally charge.

Ms. Thomsen says focusing on frauds aimed at the elderly and individual investors will be a priority in the coming year, because "when something goes wrong, the impact is magnified." She also vows to keep a vigilant eye on hedge funds, which now manage more than $1 trillion in assets.

"We still have to cover the waterfront," she says. "If we learned nothing from Enron, we've learned that. We've got to be everywhere."

Zoe Cruz
Co-President
MORGAN STANLEY
OVER THE PAST year, Zoe Cruz has solidified her position at Morgan Stanley. She served as acting president of Morgan Stanley after the return of John Mack as CEO in mid-2005 settled a bitter dispute over leadership of the securities firm.

Then Mr. Mack ended uncertainty over her status by removing the "acting" designation in February, naming her co-president alongside veteran investment banker Robert Scully. Ms. Cruz, age 51, kept authority over the firm's largest business -- institutional securities -- as well as its brokers who serve individual investors.

Ms. Cruz, a veteran of the foreign-exchange and fixed-income divisions, must now steer the firm through an era of greater risk taking, mixing more trading with the firm's own capital with an increasingly global client business. In her first year in this role, Morgan Stanley's assets rose 25% to break the $1 trillion mark for the first time as of May 31.

Mr. Mack calls Ms. Cruz "a first-class risk manager." Before one market downturn last spring, he says, "she came to me literally a week before and said, `You know, I've grown up in the currency markets, I see this trading, I'm getting concerned.' " She wanted to speak with her traders, Mr. Mack recalls, and "cut some of our positions back."

"She has an intuitive feel," he says.

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