Jolt
Morning Jolt: Regulators Go with Cantwell Market Reforms
This Morning's Loser: Financial Finaglers
The Commodity Futures Trading Commission finally approved a provision that U.S. Sen. Maria Cantwell wrote into last year's financial reform bill. The new rules lower the burden of proof—from "specific intent" to "reckless conduct"—for the CFTC when going after investment firms that manipulate commodities markets. Other regulators, such as the Securities and Exchange Commission, which oversees financial markets, have used the "reckless" standard for over 75 years.
Under the existing "specific intent" standard, the CFTC has had only one successful prosecution of market manipulation in 35 years, according to Cantwell's office.
In a statement released this morning, Sen. Cantwell said:
As we've been reporting , though, Sen. Cantwell is still waiting on the other fixes that she wrote into 2010's financial reform bill such as tighter regulations on "dark markets"—financial derivatives that are traded out of view of investors—and limiting the amount and size of market positions commodity speculators are allowed to have.
After the CFTC approved the rules this morning, commissioner Bart Chilton gave props to Sen. Cantwell: “I particularly thank Senator Maria Cantwell for her leadership on the anti-fraud and anti-manipulation provisions. Without Senator Cantwell these provisions wouldn’t exist.”
The Commodity Futures Trading Commission finally approved a provision that U.S. Sen. Maria Cantwell wrote into last year's financial reform bill. The new rules lower the burden of proof—from "specific intent" to "reckless conduct"—for the CFTC when going after investment firms that manipulate commodities markets. Other regulators, such as the Securities and Exchange Commission, which oversees financial markets, have used the "reckless" standard for over 75 years.
Under the existing "specific intent" standard, the CFTC has had only one successful prosecution of market manipulation in 35 years, according to Cantwell's office.
In a statement released this morning, Sen. Cantwell said:
Commodity prices impact every aspect of our economy and consumers deserve to pay a fair price based on supply and demand. This new anti-market manipulation rule creates a bright line which will deter bad actors from trying to get away with Enron-style behavior. Other federal regulators have used these same anti-market manipulation tools to stop and prosecute bad actors in other markets, and my hope is that the CFTC will do the same particularly in the oil futures market. These new rules of the road will enable the cops on the beat to prosecute market manipulators to the fullest extent of the law.
As we've been reporting , though, Sen. Cantwell is still waiting on the other fixes that she wrote into 2010's financial reform bill such as tighter regulations on "dark markets"—financial derivatives that are traded out of view of investors—and limiting the amount and size of market positions commodity speculators are allowed to have.
After the CFTC approved the rules this morning, commissioner Bart Chilton gave props to Sen. Cantwell: “I particularly thank Senator Maria Cantwell for her leadership on the anti-fraud and anti-manipulation provisions. Without Senator Cantwell these provisions wouldn’t exist.”
