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SPEECHES & TESTIMONY

  • Opening Statement, Public Meeting on Proposed Rules Under Dodd-Frank Act

    Commissioner Michael V. Dunn

    January 26, 2011

    Thank you all for joining us today for this important meeting regarding the implementation of the Dodd-Frank Act. Today’s meeting will address proposed rules regarding:

    • Reporting by Investment Advisers to Private Funds, Commodity Pool Operators, and Commodity Trading Advisors; and
    • Amendments to the Compliance Obligations of Commodity Pool Operators and Commodity Trading Advisors

    The proposed rule regarding reporting by Investment Advisors is the result of a collaborative effort on the part of the Commission and the SEC. Today’s proposed rule requires Investment Advisors to provide certain information to the SEC and CFTC, enabling better monitor emerging risks to the financial stability of the United States from a system-wide perspective. Information collected would be shared with the Financial Stability Oversight Council for use in monitoring such risks. I look forward to the public’s comments on this proposed rule.

    The proposed rule regarding the compliance obligations of Commodity Pool Operators and Commodity Trading Advisors provides for new data collection for CPOs and CTAs consistent with that required under the Dodd-Frank Act. I also look forward to the public’s comments on this proposed rule, particularly in regard to whether there are additional risk metrics or market factors that the Commission should require CPOs to employ.

    As I have mentioned in previous open meetings, the CFTC today faces a severe budget crisis. At our current funding level, the Commission is under serious strain. We lack the staff and resources necessary to both implement Dodd-Frank and continue to fulfill our pre-Dodd-Frank duties under the Commodity Exchange Act. Without additional funding, the strain will only become worse in July, when much of Dodd-Frank goes into effect. The lack of staff and resources leaves the Commission with very hard choices as to how to use our limited resources to enforce both Dodd-Frank and the Commodity Exchange Act. From the outset of this rulemaking process, I have expressed my concern that our budget crisis would move us from a principles based regulatory regime to a restrictive regime. Without additional funding, we cannot acquire the human and technical resources for optimal regulatory oversight. I fear the result will be a restrictive regulatory regime that will have a negative impact on both the futures and swaps industries in the United States.

    I would like to once again thank the staff at the CFTC for all their hard work in regard to these very important proposed rules. Their dedication to their important work during this difficult time is what government service is all about.

    Last Updated: January 26, 2011



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