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CFTC chairman tenders post-election resignation

Joe Mont | January 5, 2017

The post-election exodus continues. Timothy Massad, chairman of the Commodity Futures Trading Commission, has announced his departure from the agency, effective Jan. 20.

“I came to the CFTC with a number of priorities, and I am proud we have made significant progress in every area,” he said in a statement. “We have largely finished implementing the regulatory framework for swaps, and have concentrated on the areas posing the greatest risk to the financial system. We have taken many actions to make sure commercial businesses can continue using the derivatives markets efficiently and effectively to hedge routine commercial risk and engage in price discovery.”

Among the accomplishments under his tenure, the Commission proposed and adopted margin requirements for uncleared swap transactions, among the most important elements of swaps market regulation called for by the Dodd-Frank Act. The CFTC also worked to ensure clearinghouses are stronger and more resilient through enhanced risk surveillance, new supervisory stress testing, and the development and completion of recovery and wind down plans and rules, the announcement says.

Also cited as an accomplishment of his tenure was “improved international coordination” by harmonizing rules in many areas and working with other regulators on oversight of markets, “all of which has reduced inconsistency and the risk of regulatory arbitrage.”

Massad placed a significant emphasis on increased international coordination and cooperation. In addition to the work on harmonizing margin rules, he reached a milestone agreement with the European Union that resolved longstanding issues regarding the recognition and oversight of clearinghouses. Also under his tenure, the Commission made registration of foreign exchanges as a “foreign board of trade” a priority and granted exemptions from registration to a number of foreign clearinghouses.

Massad was sworn in as chairman on June 5, 2014. Prior to his tenure, he served as assistant secretary for financial stability at the Department of the Treasury, overseeing the Troubled Asset Relief Program. Prior to joining Treasury, he served as a legal advisor to the Congressional Oversight Panel for TARP. As a lawyer in private practice, he was a partner in the law firm of Cravath, Swaine & Moore.

“The United States has the greatest financial markets in the world, and sensible regulation is vital to ensuring that they remain strong, dynamic, and innovative,” Massad said. “I am grateful to have had the opportunity to contribute to that important objective.”