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CFTC funding increased … now just wholly inadequate

CFTC Acting Chairman Mark Wetjen, pronounced himself “pleased” at the $215m. increase allocated to the CFTC in the omnibus appropriations bill:

“This increase means the CFTC will be better equipped to fulfil our mission – ensuring the derivatives markets work for market participants and the public. This funding level is a step in the right direction, and we will continue working with Congress to secure resources that match our new responsibilities to provide oversight for the vast derivatives markets”

Although $100m less than President Obama’s request, the allocation represents a significant increase to the CFTC’s budget and makes the projected 12 day rolling furlough unlikely. However, it is a large % increase on very little, the funding proposals have accordingly drawn widespread criticism:

“It’s like you’re taking half the cops off the street, and they don’t have guns, radios or bullets…The CFTC is literally crippled and unable to do its job.”- Dennis Kelleher, President  of advocacy group Better Markets. The comments echo the view of Treasury Secretary Jack Lew in an earlier speech:

“After failing in efforts to block or roll back reforms, some in Congress would now simply starve the regulatory agencies of funding so they lack the resources to do their job.”

The appropriations bill continues the huge funding disparity between the two main regulatory enforcement agencies in allocating $1.35bn to the SEC, Congress seemingly oblivious to the relative size and complexity of the markets that are now under the CFTC’s area of responsibility.

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