Obama to tap Treasury official for key Wall Street oversight post
WASHINGTON (MCT) — President Barack Obama on Tuesday will nominate the Treasury official in charge of the $800 billion financial bailout fund to be the next chairman of the Commodity Futures Trading Commission, which oversees the complex derivatives industry, the White House said.
Timmothy Massad, who has spent more than three years as the assistant secretary for financial stability, is Obama's choice to succeed Gary Gensler, who has headed the CFTC since 2009, the White House said. Gensler's term expires at the end of the year.
Treasury officials said last month Massad was planning to step down.
The White House praised Massad for overseeing the Troubled Asset Relief Program, also known as TARP, which is close to breaking even after most banks have repaid their bailouts and the Treasury has sold most of the stock it acquired in firms such as American International Group and General Motors Co.
Of the $424 billion distributed in bailout funds, all but $21 billion has been repaid, according to the latest Treasury figures.
Obama is scheduled to make the formal announcement Tuesday afternoon at the White House, joined by Massad and Gensler.
"Tim Massad is the right person to lead the CFTC at this important time for our economy and financial markets," the White House said.
Obama plans to stress the important role the agency plays in implementing the Dodd-Frank financial reform law. The 2010 overhaul aimed to impose tough new rules on derivatives, which played a key role in the 2008 financial crisis.
Among the new regulations is the so-called Volcker Rule, which would place strict limits on proprietary trading by Wall Street firms. The CFTC is drafting the rule along with other financial regulators and a final version could be released soon.
Gensler led the agency through tumultuous times. As one of the only financial regulators subject to the congressional appropriations process, the CFTC has unsuccessfully lobbied Congress for more money to handle its expanded authority under Dodd-Frank.
On Tuesday, Obama "will call on Congress to stop underfunding agencies like the CFTC that are responsible for putting new rules in place to prevent some of the reckless and irresponsible practices that caused the financial crisis," the White House said.
Like other regulators, the CFTC has been criticized for not moving faster to enact a slew of new regulations called for under the law.
In addition to the end of Gensler's term, CFTC commissioner Bart Chilton recently announced he would leave at the end of the year. The five-person agency already has one vacancy and it could take months for the Senate to confirm Massad and any other new appointees.
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