February 25, 2016

Sen. Warren Asks CFTC Commissioner to Withdraw Biased, Faulty Committee Report

Full text the letter available here

Washington, DC - United States Senator Elizabeth Warren (D-Mass.) today sent a letter to Commodity Futures Trading Commissioner J. Christopher Giancarlo asking him to withdraw a newly-released report from the CFTC's Energy and Environmental Markets Advisory Committee (EEMAC), citing significant legal, substantive, and procedural irregularities.

In order to ensure market stability and prevent speculation that can drive up the cost of oil and gas for consumers, the Dodd-Frank Wall Street Reform and Consumer Protection Act requires the CFTC to set limits on positions that entities can hold on physical commodity futures and swaps. The CFTC published a proposed rule in 2013 on position limits for derivatives that would, if finalized, affect many energy trades.  The new EEMAC report is critical of those proposed rules.

But as Senator Warren highlights in her letter to Commissioner Giancarlo, "Instead of producing a meaningful examination of a serious issue that will help determine the safety and security of America's financial markets, the Committee has assembled a report that is little more than a list of talking points for an industry that hopes to escape meaningful regulation."  

She notes, "The Committee consists almost entirely of energy industry insiders, which appears to be a direct violation of section 751 of the Dodd-Frank Act; the record of the Committee's work reflects significant procedural irregularities that resulted in major flaws and mischaracterizations in the report; and the report's conclusions were not supported by the record before the Committee, and the report was adopted without any public discussion of its findings and conclusions and with no public vote."

Senator Warren concluded, "This report, which bears the official stamp of a CFTC committee, is nothing more than a recitation of industry talking points, and it should be treated as such.  Because of the legal, substantive, and procedural irregularities, I ask that you withdraw this report and refrain from submitting it to the CFTC for consideration."

Read a PDF copy of the letter here.