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Geithner's pick for top Treasury post withdraws

March 5, 2009 |  3:50 pm

Annette Nazareth, who had been Treasury Secretary Timothy Geithner's pick to be his top deputy, has withdrawn her name from consideration, reports say.

Her change of heart is another blow to Geithner, who is overseeing the financial-system rescue without a support team at Treasury because of delays in the nomination process.

Nazareth’s decision was reported this afternoon by the Wall Street Journal and Bloomberg News.

"People familiar with the decision say Nazareth withdrew in large part because of the long vetting process, which had taken weeks and included two rounds of intense questioning," the Journal reported. "Nazareth was not found to have any tax or nanny problems, these people say."

Annettenazareth Nazareth, a partner at the law firm of Davis, Polk & Wardwell, was an SEC commissioner from July 2005 to January 2008.

The Journal reported that Geithner's pick for undersecretary for international affairs, Caroline Atkinson, also has withdrawn.

Paul Volcker, the former Federal Reserve chairman who now is one of President Obama’s top economic advisors, told Congress on Feb. 26 that it was "shameful" that Geithner still lacked critical support staff.

"The secretary of the Treasury is sitting there without a deputy, without any undersecretaries, without any, as far as I know, assistant secretaries responsible in substantive areas at a time of very severe crisis. He shouldn't be sitting there alone," Volcker said.

"Now various things have contributed to this, I guess, including vetting procedures, but it really is an unfortunate situation," he said.

The Obama administration’s tough ethics rules are said to be limiting potential candidates for Treasury jobs and lengthening the vetting process.

Geithner told the Senate Finance Committee on Wednesday that the administration was proceeding as "carefully as you would expect, and you know we’re trying to make sure that we have the best talent in the country, frankly."

-- Tom Petruno

Photo: Annette Nazareth. Credit: Jamie Rose / Bloomberg News