Trouble is brewing for the long-delayed confirmation of Sharon Bowen as a member of the Commodity Futures Trading Commission, with a top-ranking Republican senator criticizing the nominee for failing to respond to repeated questions he has posed over several months regarding her role in blocking compensation to victims of a notorious Ponzi scheme.

In December 2013, President Barack Obama nominated Bowen, a partner in the New York office of law firm Latham & Watkins and acting chair of the board of directors for the Securities Investor Protection Corporation, which helps recover money to investors with assets in the hands of bankrupt and financially troubled brokerage firms.  

In January, U.S. Sen. David Vitter (R-La.) wrote to Bowen urging that SIPC revisit its decision to not compensate those affected by the fraud despite a directive from the Security and Exchange Commission to do so. His concerns relate to a financial firm run by financier Allen Stanford that a Securities and Exchange Commission investigation uncovered was the front for a $7 billion Ponzi scheme.

Vitter reiterated his concerns in a March letter. “Unfortunately SIPC, under Bowen's leadership, continues to completely miss the point,” he wrote. “The victims should be first in line for protection, but SIPC continues to prioritize its Wall Street members' spending money on lawyers to fight the SEC in court rather than protect investors. My colleagues should be aware of that kind of leadership when considering her for the CFTC.”

Among the questions Vitter posed to the nominee:

Do you believe victims should be first in line for protection, as it seems that SIPC continues to prioritize protecting its Wall Street members by hiring lawyers to fight the SEC in court rather than protect investors?

How did you determine that it was the public's interest for SIPC not to comply with the SEC's directive, especially given the SEC has plenary authority over SIPC and millions of dollars in taxpayer funds would be used to carry out the SEC's enforcement action against SIPC?

Did you receive guidance by Securities Industry and Financial Markets Association employees, or any other industry organization in any way, during the Board's discussions about whether or not SIPC was required to comply with the SEC's directive?

If your leadership resulted in denying the federal government's authority over SIPC and causing protracted litigation with the federal government for more than two years now, do you anticipate you would also defy Congress' authority over the CFTC?

Has SIPC received any outside funding for its legal defense in the SEC case?  Have you received any gifts during your time spent as a SIPC board member and now chairwoman? How much money has SIPC spent on litigation expenses in the SEC vs. SIPC case and where has this money come from?

Fast forward two months, and Vitter, in his most recent letter to Bowen, chastised her for failing to respond.

“It has been almost two months since I wrote a letter asking for answers to ten specific questions regarding SIPC's handling of the Stanford Ponzi Scheme,” he wrote. “At that time your staff responded by an email to my office stating you would respond as soon as practicable. As it has been almost two months, and I have still not received any reply from SIPC. Is two months not practicable? I wanted to remind you of your statutory duty to provide Congress with information it requests.”

Bowen, along with CFTC nominees Christopher Giancarlo and Timothy Massad, tapped to replace departed chairman Gary Gensler, have been approved by the Senate Agriculture Committee. They all await final Senate confirmation. For several weeks, the CFTC has been limited to two members, Acting Chairman Mark Wetjen and Commissioner Scott O'Malia.