The SEC, created after the 1929 stock market crash to police markets and restore investor confidence, has come under fire after the Wall Street meltdown and financial scandals exposed lapses in its oversight.
The collapses of investment firms Bear Stearns and Lehman Brothers prompted scathing criticism from lawmakers who said the agency, charged with monitoring publicly traded firms, should have flagged the problems earlier.
Criticism has intensified with the $50 billion (32 billion pound) investment fraud -- one of the biggest in history -- allegedly carried out over many years by Bernard Madoff.
Schapiro is now chief executive of the Financial Industry Regulatory Authority, a self-regulatory body for the securities industry. She served as an SEC commissioner for six years, then became chairwoman of the Commodity Futures Trading Commission (CFTC) in 1994 during the Clinton administration.Two Democrats familiar with the selection process said Obama was ready to name Schapiro as SEC chairwoman. An announcement was expected at an Obama press conference in Chicago planned for 9:45 a.m.