Bloomberg News

Wall Street Outweighs Investors in Swaps Influence, Gensler Says

September 15, 2011

Sept. 15 (Bloomberg) -- Wall Street firms have been more active than other players in seeking to influence regulators writing rules for the $601 trillion swaps market, said Gary Gensler, head of the U.S. Commodity Futures Trading Commission.

“Large institutions usually have an outsize interest in getting to us and investors tend not be knocking on our doors as much,” Gensler said today at the Bloomberg Markets 50 Summit in New York. “There is a little imbalance.”

The New York meeting is tied to the magazine’s ranking of the 50 most influential leaders in global markets, finance, business and government.

The CFTC and Securities and Exchange Commission are leading efforts to write rules mandated by the Dodd-Frank Act to reduce risk and boost transparency in trades by firms including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Cargill Inc. Dodd- Frank was enacted by President Barack Obama in July 2010 after largely unregulated trades helped fuel the 2008 credit crisis.

The CFTC has held about 1,000 meetings with firms including Morgan Stanley, Citigroup Inc. and Deutsche Bank AG. “If you look at those 1,000 meetings, the vast majority are from large financial institutions,” Gensler said.

The Dodd-Frank rules, which the CFTC is aiming to complete this year and in the first quarter of 2012, include “historic changes” to derivatives markets, Gensler said after the summit.

“What you’re seeing play out is people advocating their position and sometimes they’re advocating things that are consistent with improving the rule and sometimes they’re not,” he said.

--Editors: Lawrence Roberts, Gregory Mott

To contact the reporter on this story: Silla Brush in Washington at sbrush@bloomberg.net; Matthew Leising in New York at mleising@bloomberg.net

To contact the editor responsible for this story: Lawrence Roberts at lroberts13@bloomberg.net


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