WASHINGTON -- Securities and Exchange Commission Chairman John Shad, who has presided over the most sweeping fraud crackdown in Wall Street history, was named ambassador to the Netherlands Friday by President Reagan.
Shad, 63, a former vice chairman of E.F. Hutton & Co. who has been head of the SEC since May 1981, would succeed L. Paul Bremer as ambassador.
It had been rumored since last fall that Shad, whose five-year term expired in June 1986, would be named ambassador rather than serving another term.
White House spokesman Albert Brashear confirmed that Shad's retirement from the daily grind of regulating Wall Street has been in the works for months. 'While he deserves a chance to do this, we also hoped he'd stay on. He was much admired' in the administration, Brashear said.
Brashear said Reagan does not have a successor for Shad in mind.
Shad was criticized early in his SEC tenure for not policing Wall Street vigorously enough but later oversaw the biggest crackdown ever against securities fraud.
On May 12, 1986, the SEC charged investment banker Dennis Levine of Drexel Burnham Lambert Inc. with using inside information to win $12.6 million in illegal profits.
Levine's cooperation with the SEC and the U.S. attorney's office led to a series of settlements and prosecutions against Wall Street executives, including the settlement of charges on Nov. 14 against legendary stock speculator Ivan Boesky.
Boesky -- who pleaded guilty to a felony charge -- also agreed to pay $100 million in penalties and restitution in an arrangement worked out with the SEC.
Other top securities executives caught in the investigation included Martin Siegel and Richard Wigton of Kidder, Peabody & Co. and Robert Freeman, a partner at Goldman Sachs.
The latest individual named in the investigation was Boyd Jefferies, who resigned Thursday as chairman of Jefferies Group Inc. in Los Angeles.
Shad was born June 27, 1923, in Brigham City, Utah. He graduated with honors from the University of Southern California in 1947 after a three-year interruption for service in the Navy during World War II. He earned a master's degree in business from Harvard in 1949, and a law degree from New York University in 1959.
He is the author of several books on international business.
Shad married Patricia Pratt in 1952. They have a daughter and a son and live in New York City.