When President Bush tapped Christopher Cox to replace William Donaldson, it looked like Bush was swapping an aggressive reformer for a kinder, gentler regulator. After all, Cox, a nine-term Congressman, was known for his anti-regulatory stands. Yet since he took over as chairman in August, Cox has shown that he is not the anti-Donaldson.

Cox's best-known effort so far is shining the spotlight on executive pay, but he has also kept up the litigation and regulatory pressure that was the hallmark of the relatively brief tenure of his predecessor.

The numbers tell the tale. In his first six months, the SEC's litigation folder is as thick with cases as it was under Donaldson for the same period. Both put out well over 200 litigation releases. Indeed, Cox's visibility — frequently to make public statements that he was not turning back the clocks — is even greater than that of Donaldson over the same stretch with more speeches and arguably bigger cases.

Among the most high-profile moments and litigation successes for Cox and the SEC was last month's $1.5 billion settlement with AIG — rivaling the largest in history. The SEC also reached a record $153 million market timing settlement with a Las Vegas trader the previous month.

When President Bush nominated him last June to replace the retiring Donaldson, who was not a White House favorite, the securities industry gave out a collective sigh of relief. The 53-year-old Harvard Law graduate, it was widely assumed, was going to trash recently enacted rules meant to protect individual investors so the financial community could spend their time aggressively doing business without the encumbrances of filling out forms and reciting caveats to their customers.

Yet, right from the start, he let Wall Street know that wouldn't be the case. Both the left and the right acknowledge that he has been true to his word. In his first speech before the Securities Industry Association in November, Cox told the assembled industry executives: “The guns of the SEC are not about to go silent.”

Even actions out of the public eye have not been what anyone would have expected from Cox in the past. His first permanent appointment fit the bill: naming Luis Mejia, who joined the SEC when Bill Clinton was president, chief litigation counsel of the SEC's enforcement division.

While Cox may yet revert to form, brokers may do well to cheer him on his early course. Substitute individual or the underdog for investor and you may as well be talking about financial advisors. When the Financial Planning Association (FPA) — read little guy — objected to the bid by the SIA — read big guy — to gain an extension before it's broker/dealer members had to comply with Rule 202 come Feb. 1, the SEC turned a deaf ear and the rule went into affect on time. Similarly, Cox has ignored corporate America's drive, spearheaded by the Business Roundtable, to obtain personal contact information on individual investors so they can pitch them directly — thereby bypassing their advisors, who tend to hold (in name) their clients' shares for them. The big cases and settlements, like the one on market timing, are also in the best interest of individual advisors as they weed out the crud that give brokers a bad name.

Cox's own agenda appears to stress transparency. He's a proponent of making financial information more accessible and easier to understand, as well as detailing executive pay.

To be sure, there is much more he can do. Derivatives accounting is still the stuff of black boxes and corporate pension earnings accounting is a joke. Corporate earnings reflect what pension investment returns are expected to be, not what they are.

Cox would also do well to push to expose the two sets of books corporations effectively keep. One shows the earning reported to the SEC and shareholders; the other, which isn't made public, is the earnings corporations show the Internal Revenue Service. Since the latter generally reports a lower figure, they would be particularly nice to see.

Cox has said that what makes our markets “the gold standard” is trust and investor confidence. If investors have that — and transparency will sure help build it up — then financial advisors will get it — their clients' business, that is. And isn't that what it's all about?

Barry Rehfeld is the executive editor of Registered Rep.