John M. Fedders, a 39-year-old partner in the prestigious law firm Arnold & Porter, was named yesterday to head the Securities and Exchange Commission's enforcement division.
Fedders, who has often represented corporations and their officials on the other side of SEC proceedings, promised yesterday to continue the SEC's active and effective enforcement of the securities law and said that he expects to make changes more of style than substance.
Fedders said his priorities as director of the division include investigations of insider trading, organized crime, fraud and market manipulation.
Fedders takes over a division famous for exposing corporate wrongdoing during the 1970s, which has recently been less visible, succeeding Stanley Sporkin, who left the SEC last month to become general counsel of the Central Intelligence Agency.
Sporkin was on hand yesterday when SEC Chairman John S. R. Shad announ ced Fedders' appointment and said he was gratified that the SEC had found someone with Fedders' qualifications. "John knows I will be looking over his shoulder, and he will get a tremendous amount of constructive advice," Sporkin said.
Also on hand were the enforcement division's four associate directors, including Theordore A. Levine and Irwin M. Borowski, who had been mentioned as possible successors to Sporkin. Fedders said he hoped that there would be little turnover in the wake of his appointment and said he intends to appoint a deputy from within the agency.
Shad, who has spent much of his time since assuming the chairmanship of the SEC interviewing enforcement chief candidates, said that Fedders "is exceptionally well qualified to meet the enforcement challenges of the 1980s. Fedders was highly recommended by securities lawyers, according to Shad, who noted that Fedders would take a large pay cut to come to work for the agency.
Fedders is regarded by those who have litigated against him as a smart, tenacious lawyer who could lead the enforcement division with vigor if he chooses to. Fedders, 6 feet 10 inches tall and a former Marquette University basketbal player, indicated his style may be more deliberate than Sporkin's.
Fedders said he would not participate in SEC actions involving cases he had handled as a private lawyer or cases in which Arnold & Porter is currently involved. One case that brought Fedders in contact withthe SEC in the past was the agency's investigation of questionable payments made by Textron Inc.
The new enforcement director said he does not expect to feel circumscribed by any positions he has taken in the past in opposition to the SEC. "I represent my clients to the fullest," he said. "I have a new client, and when I begin to work here I will represent that client to the fullest," he said.
He said that he will enforce the current law prohibiting corrupt payments to foreign officials by American corporations and legal provisions designed to ensure that a company's accounting reveals irregularities, even though he has reservations about the law.
Fedders has been with Arnold & Porter since 1973. Before that he was an executive vice president of the Gulf Life Holding Co. In Dallas -- management experience that Shad said was one of the things that figured strongly in his choice.
Fedders has also worked as an associate with Chadwalader, Wickersham & Taft in New York City and as a law clerk in the office of the general counsel of the National Aeronautics and Space Administration. He is from Covington, Ky.