Senator Stabenow Questions Regulatory Oversight Of MF Global
November 15 2011 - 8:48PM
Dow Jones News
Sen. Debbie Stabenow (D., Mich.) questioned regulatory oversight
of failed broker-dealer MF Global and announced a hearing to look
into the subject, in a letter to regulators Tuesday.
"The bankruptcy raises a number of questions including the
dangers of excessive leverage, the adequacy of existing
protections, and the exposures our economy may have to events
around the globe," Stabenow said in a letter to Commodity Futures
Trading Commission Chairman Gary Gensler.
The CFTC is leading the investigation into nearly $600 million
in missing customer funds that regulators say they were told about
only hours before the firm filed for bankruptcy.
"That funds are missing highlights an extraordinary breach of
trust -- it is unacceptable that there are any doubts about the
safety of customer assets," Stabenow said.
Stabenow, chairman of the Senate committee that oversees the
CFTC, also announced a hearing on "the oversight of our financial
markets."
Stabenow also asked a number of questions about the CFTC's
regulatory system for keeping tabs on futures firms like MF
Global.
"Are the scope and frequency of audits sufficient to understand
the full exposure of firms like MF Global and the risks they may
pose to the markets?" Stabenow asked in the letter.
Stabenow also asked whether the self-regulatory system, which
gives primary oversight of many futures firms to exchange operator
CME Group, was functioning properly.
-By Jamila Trindle, Dow Jones Newswires; 202-862-6684;
jamila.trindle@dowjones.com
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