Fact Sheet on CFTC Funding
Increased funding of the Commodity Futures Trading Commission is a crucial piece of Wall Street reform. Here’s why.
Increased funding of the Commodity Futures Trading Commission is a crucial piece of Wall Street reform. Here’s why.
“Refusing to adequately fund the CFTC is a backdoor attack on derivatives regulation. The agency needs the resources to meaningfully implement and enforce the new rules that Congress directed it to write. Those rules are essential to the mission of bringing basic standards of transparency and safety to markets that, left unchecked, were at the heart of the financial crisis that did so much damage to our economy.”
AFR submitted a comment letter to the financial stability board on plans for the aggregation of global derivatives data.
“The derivatives market is a global market, but risks incurred by U.S. firms can impact the U.S. economy regardless of where a derivatives transaction takes place. As the process of cross-border regulation moves forward we urge the CFTC to ensure that all derivatives transactions posing a risk to the U.S. economy fall either under U.S. rules or under a regime that is fully equivalent to U.S. rules and is properly enforced.”
“Lisa Donner, head of Americans for Financial Reform, contends the CFTC budget was slashed at the behest of Wall Street lobbyists seeking to undercut the effectiveness of financial reform. The budget savings are so miniscule that ‘it’s not plausible that the real issue is budget numbers,’ she says.”
“In a brief advisory statement, the Commodity Futures Trading Commission has closed a specious, lobbyist-concocted loophole in the regulation of the derivatives markets. By doing so, the Commission has reaffirmed one of the most important and hard-won victories of the Dodd-Frank Act.”
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“The CFTC is at an important crossroads,” the Washington Post observes. “The 2010 Dodd-Frank Act directed the agency, with 674 employees and a $194 million budget, to oversee a $400 trillion piece of the unregulated derivatives market, a key contributor to the financial crisis. The CFTC has almost finished writing the rules mandated by the law and must now get Wall Street to comply.”
The House of Representatives recently voted to roll back a provision of the Dodd-Frank Act that, as reporter Ailsa Chang explained on All Things Considered (NPR, 11/11/13), “prevents banks from using your deposits to trade in derivatives — risky securities that many believe contributed to
“’The House is the odd man out in terms of doing Wall Street’s bidding,” says AFR policy director Marcus Stanley. “They’re letting Wall Street write the law to its own benefit in ways that harm the public.”