Treasury Department Must Reject Senators’ Calls to Further Delay CFTC Cross-Border Derivatives Regulation Implementation
“The June 26 letter from six U.S. Senators to Treasury Secretary Jack Lew, which called for further delay of cross-border derivative reform until such time that the Commodities Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) can harmonize their guidance, fails to note a number of material facts essential to understand the issues and properly evaluate them,” said Dennis Kelleher, President and CEO of Better Markets, Inc., a nonprofit organization that promotes the public interest in the financial markets.
“Better Markets sent a letter to Secretary Lew pointing out those facts. The full letter is attached below, but here are the key points in summary. First, the recently proposed rule by the SEC is inapplicable to the CFTC as a legal matter due to entirely different statutory mandates. Second, it is also inapplicable as a practical matter: the CFTC has jurisdiction for more than 96.5 percent of the derivatives markets and the SEC less than 3.5 percent. Third, the SEC just proposed it’s 650 page rule in May, while the CFTC has been considering cross border regulation for more than 2 ½ years, has received and reviewed more than 322 comment letters, and proposed its guidance a year ago,” said Mr. Kelleher.
“The CFTC should delay no more and the SEC should follow its process as appropriate. Neither should be held hostage to each other, particularly because they are largely irrelevant to each other,” Mr. Kelleher concluded.
Better Markets is an independent, nonprofit, nonpartisan organization that promotes the public interest in financial reform in the domestic and global capital and commodity markets. Better Markets advocates for transparency, oversight and accountability with the goal of a stronger, safer financial system that is less prone to crisis and failure thereby eliminating or minimizing the need for more taxpayer funded bailouts. To learn more, visit www.bettermarkets.com.