Webster may quit audit panel

Mr Pitt (left) has blundered in his choice of Mr Webster

By David Schepp BBC News Online North America business reporter

The recently elected chairman of a newly established accounting oversight board in the US has indicated he may resign if the controversy over his selection impedes the ability of the agency to get on with its work.

Mr Bush welcomed Mr Pitt's Election Day resignation

William Webster, the former head of the Central Intelligence Agency (CIA) and the Federal Bureau of Investigation (FBI), made the comments following the launch of an investigation into the process by which he was chosen to lead the oversight board.

Mr Webster has been the object of scrutiny since his election to lead the Public Company Accounting Oversight Board 10 days ago.

Within days of the appointment, it was learned Securities and Exchange Commission (SEC) Chairman Harvey Pitt withheld crucial information about Mr Webster's work at US Technologies.

The firm is now the subject of investor lawsuits and stands accused of accounting irregularities that occurred during Mr Webster's tenure as head of its audit committee.

As a result of the controversy, Mr Pitt himself resigned on Tuesday evening.

Eager to serve

The SEC established the accounting board Mr Webster is to lead last month following the passage of the Sarbanes-Oxley Act in July, which mandates corporate reforms.

But before it could get underway, the agency established to ensure propriety among auditors has been mired in its own controversy.

Mr Pitt's political missteps soured a notable career

Yet members of the oversight board have told the Washington Post newspaper they are keen on getting on with their work and have established 13 November as the date of their first meeting.

"We're all eager and anxious to get going and are not waiting for the SEC to finish their investigation," a board member told the Post.

Mr Pitt called for the investigation, following disclosure that he failed to inform four other members of the SEC board of Mr Webster's position at US Technologies.

In effect, the SEC chairman called for an investigation into his own actions behind the selection process of Mr Webster.

Low profile

In addition to the SEC's own probe, Congress intends to hold its own hearings when it reconvenes next year and has called on the General Accounting Office (GAO) to investigate as well.

On Tuesday, speculation had been rife in Washington and on Wall Street that Mr Pitt would leave the agency shortly after US mid-term elections, after repeated calls from both Democrats and Republicans for his resignation.

Mr Pitt had cancelled a number of appearances, including a speech on Tuesday in New York before a group of financial executives.

The SEC originally blamed a scheduling conflict for the no-show.

Mr Pitt had been scheduled to appear on Friday at the annual conference of the Securities Industry Association, whose theme this year is building investor confidence.

While the White House to the last moment professed its support for Mr Pitt, it had been seen as likely that he would be asked to resign following the mid-term elections.

George W Bush reportedly was seriously annoyed with Mr Pitt's constant political missteps, which embarrassed the Republican president.