WASHINGTON, June 18, 2014— The National Grain and Feed Association (NGFA) and more than 30 other organizations including groups representing state and national crop and livestock producers are urging House members to vote for a bill funding the Commodity Futures Trading Commission (CFTC) that includes protections for agricultural futures customers.
The House Rules Committee held a hearing today on the Customer Protection and End-User Relief Act (HR 4413), which would reauthorize the CFTC as well as make other reforms. The legislation has not yet moved to the House floor.
The last time Congress passed legislation reauthorizing the agency was in 2008, before the financial crisis and prior to the enactment of the Dodd-Frank Act.
In a letter, the organizations said the legislation, approved by the House Agriculture Committee and sponsored by Chairman Frank Lucas, R-Okla., provides protections for futures customers.
Among its benefits, NGFA and its allies said the bill provides enhanced reporting, transparency and accountability in futures markets. “These much-needed improvements will help prevent another MF Global,” they wrote, referring to the derivatives brokerage that went bankrupt in 2011.
The bill would also allow customers to “claw back” assets from a parent company in the event of a shortfall of customer funds in the event of insolvencies by futures merchants, something that wasn’t possible with MF Global.
However, some Democrats asked that amendments to the bill be recognized on the House floor. Rep. Maxine Waters, D-Calif., said the bill as it stands provides “legislative loopholes” by weakening the authority of CFTC. Waters plans provisions to strengthen CFTC rules. She also said she supports an amendment from Rep. Rosa DeLauro, D-Conn., that would allow the CFTC to cover its annual budget by collecting user fees from market participants.
Groups that signed the letter include the American Soybean Association, the National Corn Growers Association, the National Cattlemen’s Beef Association, the National Pork Producers Council, the National Cotton Council and USA Rice Federation.
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