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Thursday, October 11, 2012

CFTC Fundamentally Misunderstood Congresional Intent

A group of Congressmen wrote CFTC Chairman Gary Gensler questioning the adequacy of the CFTC’s rulemaking process.

On September 28th the U.S. District Court for the District of Columbia issued a ruling striking down the CFTC’s “Position Limits Rule” because the CFTC did not follow the Congressional intent and the letter of the law while implementing Title VII of the Dodd-Frank Act.

U.S. District Court Judge Robert Wilkins stated:
[T]he CFTC’s error in this case was that it fundamentally misunderstood and failed to recognize the ambiguities in the statute…

The agency failed to bring its expertise and experience to bear when interpreting the statute and offered no explanation for how its interpretation comported with the policy objectives of the [Dodd-Frank] Act.
Due to the court’s findings the Congressman expressed they have become concerned regarding CFTC funding and prioritization.
We are very concerned…that CFTC staff are using limited resources to pursue ideological and political goals rather than using the resources allocated by Congress to carry out the direct requirements of the agency.
The Congressmen who wrote the letter included Scott Garrett, Chairman of the Capital Markets and GSE Subcommittee; Randy Neugebauer, Chairman of the Oversight and Investigations Subcommittee; Jeb Hensariling, Vice-Chairman of the Financial Services Committee; and Spencer Bachus, Chairman of the Financial Services Committee.

Read the Congressmen’s letter.

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