WASHINGTON — Four senior Republicans are criticizing the Commodity Futures Trading Commission's judgment and use of resources after a federal court struck down its controversial "position limits" rule.
The lawmakers are also asking the agency to provide estimates of how much the promulgation of the rule and eventual litigation are likely to cost, in light of the agency's request for a nearly 50% budget increase in fiscal year 2013, according to a letter sent Wednesday to CFTC Chairman Gary Gensler.
The U.S District Court for the District of Columbia invalidated the agency's rule limiting speculation in certain derivatives markets late last month, which the CFTC undertook as part of its implementation of the Dodd-Frank reform law.
"We are very concerned, in the wake of the financial crisis, that CFTC staff are using limited resources to pursue ideological and political goals rather than using the resources allocated by Congress to carry out the direct requirements of the agency," Reps. Scott Garrett, R-N.J., Randy Neugebauer, R-Tex., Jeb Hensarling, R-Tex., and Spencer Bachus, R-Ala., said in the letter.
"Given the court's finding that the CFTC failed to properly justify the rule, we are concerned that CFTC funds were prioritized to promulgate and defend a rule that was not central to the financial crisis."
The lawmakers, all members of the House Financial Services Committee, also requested that the agency provide "the total number of CFTC-staff labor hours dedicated to the Position Limits rulemaking process, including but not limited to the drafting of the proposal, meetings with interested parties, review and analysis of the comment letters, and the final promulgation of the rule, as well as the total dollar amount associated with that labor," in addition to the expenses for litigating the rule, by Oct. 26.