CFTC Commissioner O'Malia Remarks: "Stifling of Swaps Markets Before Dodd-Frank Rules Take Effect"

CFTC Commissioner Scott D. O'Malia made a speech discussing his observations on U.S. efforts to regulate derivatives markets. Commissioner O'Malia believes that the CFTC, in a rush to promulgate the rules, has lost sight of the statutory goals of Dodd-Frank and has disregarded the Congressional mandate to preserve end-users' business. O'Malia states that this has led to the CTC's adoption of rules that are unclear, inconsistent and harmful to U.S. businesses. Further, O'Malia argues that imposition of (what he believes are) unnecessary regulations on end-users will create more economic instability and impede U.S. competitiveness in the global market. Most importantly, O'Malia says that OTC derivatives market regulation must be consistent across jurisdictions.Commissioner O'Malia further addressed the following topics in his speech: (1) Intercontinental Exchange's (ICE) decision to list its over-the-counter (OTC) derivatives as futures instead of swaps; (2) status of the SEF rules and O'Malia view about the necessary features of an effective SEF; (3) the Commission's proposed Cross Border Guidance.

Lofchie Comment: This is the second speech that Commissioner O'Malia has made in a very short period politely, and in measured terms, blasting the CFTC's rulemaking. (Link to the first here.)

View speech in full here (links externally to CFTC website).