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.
Foreign Regulators Caution: Cooperation Essential to Market Stability
Tamara Hinton, 202.225.0184
WASHINGTON – Today, Rep. K. Michael Conaway, Chairman of the House Agriculture Committee's Subcommittee on General Farm Commodities and Risk Management, held a public hearing to examine the challenges facing the United States and international regulators as they attempt to balance various derivatives reforms across a global marketplace. Appearing for the first time before a Congressional committee, regulators from the European Union and Japan cautioned that U.S. markets were at risk if due care was not taken to complement regulatory structures across foreign jurisdictions.
"I appreciate the time of all our witnesses, but especially those who flew thousands of miles to discuss this timely and important topic. If we do not get our Dodd-Frank rules right, American end-users, who use swaps to manage everyday business risks, may have fewer counterparties to deal with. Fewer counterparties will mean less competition and less liquidity in the market, which will lead to higher costs and a higher concentration of risk in the United States. With our economy facing an uncertain future, we can ill-afford to implement reforms without a good faith attempt to cooperate with the international community. As we heard here today, failure to do so could have enormous consequences for global derivatives markets," said Chairman K. Michael Conaway (R-TX).
"The consequences of poor sequencing of rules and implementation dates by the CFTC, and poor coordination both with other domestic regulators and foreign regulators as well, are real and damaging to U.S. companies. As we saw earlier this year domestic banks can and will lose business to foreign competitors if Title VII rules are not implemented properly and in a timely fashion, and that will in turn harm the end-user companies they serve and that we on this committee care so very much about," said Rep. David Scott (D-GA).
Written testimony provided by the witnesses is linked below.
The Honorable Bart Chilton, Commissioner, U.S. Commodity Futures Trading Commission; Washington, D.C.
The Honorable Jill E. Sommers, Commissioner, U.S. Commodity Futures Trading Commission; Washington, D.C.