President-elect Donald Trump is nominating Jay Clayton, a Wall Street lawyer, to be the head of the Securities and Exchange Commission. Some who know him say Clayton is a good man for the job, but critics say his ties to big financial firms create too many conflicts of interest.

The big question is whether Trump has chosen a fox to guard the henhouse.

Clayton works as a lawyer for a firm that has represented Goldman Sachs for decades. He also represented Ally Financial and other financial firms when they struck settlements related to wrongdoing in the subprime mortgage scandal.

And Clayton's wife currently works for Goldman Sachs.

"I do think that having a chairman of the SEC whose spouse works at Goldman Sachs or another large investment bank is a serious problem," says Richard Painter, a law professor at the University of Minnesota and the former chief White House ethics lawyer under President George W. Bush.

Painter says Goldman and other big banks had their business models severely restricted by the Dodd-Frank Wall Street Reform Act, and there is already pressure building to scale back that law during the Trump administration.

"The decision about whether to repeal Dodd-Frank, or how to enforce Dodd-Frank and rulemaking under Dodd-Frank — all those decisions will have an enormous impact on Goldman Sachs," Painter says. "And to have Goldman Sachs have a controlling influence over the career of the SEC chairman's spouse, I think could be an untenable situation."

Still, Painter says he is withholding judgement until he watches the nomination hearing process. Maybe there's a way to resolve that and other conflicts. And he says just because Clayton is a Wall Street insider, that doesn't mean he'd be a bad SEC chairman.

"There are plenty of good Wall Street people who could actually aggressively regulate Wall Street. They know where the bodies are buried; they know where the reforms are necessary," Painter says.

So, is Clayton that kind of Wall Street insider — or the kind that would be soft on enforcement?

"What I understand about him is that he's a very, very capable lawyer, very knowledgeable, practical and very results-oriented," says Bill McLucas, who was head of enforcement for the SEC under the administrations of George H.W. Bush and Bill Clinton.

And, McLucas says, if Clayton makes it through the congressional hearing and vetting process, if past SEC chairs are any guide, "once they are confirmed it is rare that the public interest is not their guiding principle."

Still, there are plenty of skeptics. Former Rep. Barney Frank says he sees more of the same here — a series of nominations by Trump of people who are too beholden to Wall Street.

"It is one more example of the biggest bait-and-switch, I believe, in American history — namely Trump winning by claiming he was going to stand up to Wall Street and be tough and then becoming the best friend Wall Street and the opponents of regulation have ever had," Frank says.

Frank says the Dodd-Frank law that bears his name gave the SEC strong powers to protect the financial system as well as everyday Americans who are buying stocks or buying their first home. But, he says, "You cannot make laws that are self-enforcing."

Frank says he's worried that even if Republicans don't have the votes ultimately to repeal laws such as Dodd-Frank, the appointments Trump is trying to make could still severely weaken regulation. And, Frank says, that could make the financial system and everyday Americans less protected from wrongdoing.

Copyright 2017 NPR. To see more, visit http://www.npr.org/.

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