August 27, 2002
Bush may appoint W.R. Timken to broker board
By Paul M. Krawzak and Paul E. Kostyu
Copley News Service
WASHINGTON — President Bush, hoping to restore public confidence in corporate America, is moving toward the nomination of W.R. “Tim” Timken Jr., chairman of The Timken Co., to a board set up to protect investors.
Bush is considering Timken for the Securities Investor Protection Corp., which Congress created in 1970 to protect the assets of
customers of failing brokerages, Timken said Monday. The position requires Senate confirmation.
Before Timken can be nominated, the FBI must complete a routine background check, which is in progress. The FBI has been
conducting the check for the month or two, according to Robert Lapp, vice president of government affairs at Timken.
Timken, a major financial contributor to Bush and other Republicans, never has served in the federal government or been
nominated for a position by the president. Timken traveled to Washington regularly last year when he was chairman of the National Association of Manufacturers.
White House officials had no comment on Timken, since their policy is not to discuss any pending nomination until it officially is
Lapp said Timken “has a strong background in ethics and integrity.” His selection comes at a time when several prominent
corporations are under fire for illegal or unethical behavior.
Timken recently stepped down as chief executive officer of the steel and bearings manufacturer named for his family. He was not
seeking a position in the government, Lapp said.
If he is nominated and confirmed, Timken would join a seven-position board that oversees and sets policy for the investor-protection corporation.
Although Congress created it, it is a nonprofit corporation rather than a government agency. Since 1970, the organization has
recovered $13.9 billion for an estimated 622,000 investors. Supported by dues from broker members, the corporation steps in to
protect customers’ cash and securities when a brokerage gets in trouble.
“I hope this comes to pass,” Rep. Kirk Schuring, R-Jackson Township, said of Timken’s consideration for the post. Timken “has a long and steady history of being a very honest and forthright person. He’s the type of person whose appointment is very
appropriate, given the tenuous nature of the stock market and of the things going on with it at this time.”
Curt Braden, chairman of the Stark County Republican Party, added that “America would be well-served by him serving on that
John Morgan, vice president of Champaign Investment Co. in Fairlawn, a member of the investor-protection corporation, didn’t know what impact Timken might have on the organization. But he said the appointment “may be politically a good move” given that some brokerages in Northeast Ohio have been in financial trouble.
Board members serve part-time without salary. The chairman, however, receives $1,000 per meeting, and the vice chairman gets
$500 per meeting. Board members attend about five meetings a year.
“This is really a public service that they’re doing when they serve on the board,” said Michael E. Don, who as president is top staff
member of the corporation. Board positions require no major time commitment, he added.
Timken would stand at least a 50-50 chance of being named chairman of the board, composed mainly of holdovers from the Clinton administration. President Bush must appoint two members of the board from the “general public.” He names one of them chairman and the other vice chairman. Other board members are drawn from the securities industry and government.
The previous chairman, J. Clifford Hudson, chairman and chief executive officer of Sonic Corp. in Oklahoma City, received his
appointment from President Clinton. He resigned in February 2001. Since then, vice chairman Debbie D. Branson, another Clinton
appointee, has served as acting chair. Bush has nominated replacements for her and for another board member, but they have not been confirmed.