WASHINGTON, DC – U.S. Senator Pat Roberts (R-Kan.) today said the Commodities and Futures Trading Commission (CFTC) had work to do to address regulatory overreach and will need to do more in the future to recognize the concerns of all market participants including farmers and ranchers.

At a hearing of the Senate Committee on Agriculture, Nutrition and Forestry, Roberts, a senior member and the former ranking member of the Committee, thanked CFTC Chairman Timothy Massad on his willingness to correct the mistakes of the previous Commission, especially on issues Roberts had concerns with including residual interest rules and proposals for reporting requirements.

Senator Roberts and Senator Heidi Heitkamp (D-ND) introduced legislation, S. 2601, to enhance customer protections for farmers and ranchers by preventing regulations from the CFTC from being overly laborious and making it significantly more difficult for farmers and ranchers to make economical trades on commodities.

“The Commission’s actions over the last several months have demonstrated that the previous commission and Chairman often took Dodd-Frank regulations much further than required by the law…and wouldn’t stop to listen to feedback from stakeholders including market participants and Congress,” Roberts said.

“While I value the work you have undertaken to correct several regulatory missteps and over-reaches, several of the tweaks the commission has proposed, but not yet finalized, were simply low hanging fruit that many of us around this table have raised for years,” Roberts said. “I know that most of us are anxious to see the easiest fixes put into place, particularly for agriculture and end users, including the proposals for reporting requirements and residual interest.”

Roberts also noted that the CFTC is set to receive nearly 50 percent more in funds since 2010, including the “cromnibus” proposed by the House. Roberts said that despite the challenges facing the agency, its spending should not be allowed to continue to grow unchecked.

Roberts remains concerned with the following CFTC regulatory issues:

market participation: small and medium sized Future Commission Merchants (FCM’s) are closing and consolidating;
time and resources on the further study of the collection of residual interest despite the Commission’s decision to end the automatic pre-funding of margins given the unpopular and unrealistic rule’s high cost to farmers for little to no benefit;
the use of staff no-action letters and regulatory guidance instead of following federal rulemaking procedures including a cost benefit analysis;
cross-border issues from lack of regulatory equivalence from the European Union including the definition of “U.S. person”;
and foreign businesses are choosing to relocate their business and capital away from the U.S. markets.
Senator Roberts is a senior member of the Senate Committee on Agriculture, Nutrition and Forestry.