“Wall Street’s megabanks are at it again. The too-dangerous-to-fail bailout babies have found yet another new dark market to manipulate: ethanol credits, as the New York Times reported.

“While it sounds pretty harmless, speculation by Wall Street’s biggest banks in this obscure commodity — which was originally created to reduce our dependence on foreign oil — will drive up prices at the gas pump and hurt Main Street. Transparency, oversight and regulation are needed to help keep prices in check and protect consumers.

“In 2007, Congress passed new Renewable Fuel Standards (RFS) requiring an increasing amount of ethanol be incorporated into the nation’s fuel supply over time. To enforce compliance with the mandate, Congress came up with a credit system: every gallon of ethanol produced or imported would be assigned a renewable identification number (RIN).

“After buying ethanol and blending it into their fuel, energy companies submit the RINs to federal regulators to prove they met RFS obligations. Excess RINs can be sold as credits on the open market to third parties — including bankers. But the federal biofuel requirements for 2013 require an amount of RINs that exceeds the available supply, which led to a steep increase in RINs prices.”

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Read Dennis Kelleher’s full Huffington Post piece here