FOR IMMEDIATE RELEASE: June 15, 2012                                                                                                                                                CONTACT: Erin Kilroy at 202-466-1885

AFR Statement on Senate Appropriations Committee Approval of Increased Appropriations for the CFTC and SEC

Washington, DC – Americans for Financial Reform, a coalition of more than 250 national, state, and local organizations working together for strong Wall Street reform, issued the following statement:

AFR applauds the Senate Appropriations Committee approval of sorely needed increases in funding for the CFTC and for the SEC.  Adequate funding for these agencies is a necessary precondition to holding Wall Street accountable, providing the oversight needed to make the financial system more transparent, and taking the steps needed to prevent another financial crisis.

The CFTC in particular has been dramatically underfunded, and its current budget is totally inadequate to its important new roles in overseeing previously ‘dark’ over the counter derivatives markets. The CFTC’s job in regulating financial markets is vital to businesses who use commodity markets to hedge bona fide business risks, to the economic well-being of American families who rely on affordable prices for products like gasoline and food, and to the stability of our overall financial system.  Recent multibillion dollar losses by JP Morgan Chase on derivatives deals are just one more reminder of how important it is to have effective regulators on the job.

The question now is whether adequate funds will survive the rest of the budget process.  House appropriators are moving on a budget that actually cuts CFTC funding from current levels, as well as limiting its flexibility to spend dollars where they are most needed.   The clear intent of the House budget is to protect the Wall Street derivatives dealers from accountability or oversight, and to preserve the status quo that was a major cause of the financial crisis.

With millions of Americans still out of work as a consequence of the financial crisis, more than $8 trillion lost in home values and retirement savings, and millions of foreclosures it could not be clearer that Wall Street must not be allowed to gamble in the shadows. Underfunding the CFTC would sabotage progress made in reining in the casino economy, and allow a handful of firms to continue to speculate in the dark at the public’s expense. The SEC has much important work it should be doing to protect investors and the public, underfunding would be a push in absolutely the wrong direction.

###