Chairman Frank Lucas today released the following statement on Scott O'Malia's last day as Commissioner of the Commodity Futures Trading Commission (CFTC). Last month, O’Malia announced he would resign to pursue other opportunities.
Ag Panel Explores Ways to Improve Customer Protections, Avoid Another MF Global
Tamara Hinton, 202.225.0184
WASHINGTON – Today, Rep. K. Michael Conaway, Chairman of the House Agriculture Subcommittee on General Farm Commodities and Risk Management, held a fourth hearing on the future of the Commodity Futures Trading Commission (CFTC) in advance of writing legislation to reauthorize the agency. The purpose of this hearing was to explore ways to improve customer protections and understand how best to avoid or prevent the collapse of another futures commission merchant (FCM) that disproportionately impacts farmers and ranchers in light of the failures at MF Global and PFG Best.
"Improving customer protections in futures markets is a topic that members on both sides of the aisle have been eager to explore for some time. For many of our constituents, the failure of MF Global and PFG Best added a new worry to their already overcrowded plate of concerns. An essential part of our job as lawmakers is to figure out the best way to restore confidence that an investor’s funds will always be safe, no matter what happens to other market participants. Our challenge is to put in place systems and processes that ensure mistakes are caught swiftly and wrongdoing is made exceptionally difficult. As we do so, we must examine whether the costs of new regulations outweigh the benefits to the marketplace," said Chairman K. Michael Conaway (R-TX).
"We must ensure that whatever regulatory regime the CFTC moves to put into place to protect our farmers, ranchers and co-ops in the future works well for all involved in the market by reducing risk and protecting customer funds without significantly raising the price of doing business. But, as we continue to place burdens upon the CFTC to do more and to do better, we must also ensure they have adequate fiscal support to do the tasks they’re charged with," said Ranking Member David Scott (D-GA).
This is expected to be the final hearing in the series on the future of the CFTC. The first one was a full committee hearing to gain perspectives from the market. The last two were subcommittee proceedings to hear from the CFTC Commissioners and end-users directly.
Written testimony provided by the witnesses is linked below.
Mr. Terrence A. Duffy, Executive Chairman and President, CME Group, Inc., Chicago, Illinois
Mr. Daniel J. Roth, President and CEO, National Futures Association, Chicago, Illinois
Dr. Christopher L. Culp, Senior Advisor, COMPASS LEXECON, Chicago, Illinois
Mr. Michael J. Anderson, Regional Sales Manager, The Andersons Inc., Union City, Tennessee, on behalf of the National Grain and Feed Association
Mr. James L. Koutoulas, Esq., President and Co-Founder, Commodity Customer Coalition, Inc., Chicago, Illinois
Mr. Theodore L. Johnson, President, Frontier Futures, Inc., Cedar Rapids, Iowa