CFTC Said to Dodge the Bullet

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If you've been thinking of applying to work at a federal regulatory agency but fear the Obama adminstration's looming overhaul might blow your target out of the water, here is one scenario you can stop worrying about: a merger between the Commodity Futures Trading Commission and the Securities and Exchange Commission.

That isn't in the cards, reports.

During a dinner last week for key lawmakers, Treasury Secretary Timothy Geithner "indicated he would not pursue a merger of CFTC and SEC," the story says, citing an unnamed industry official familiar with the conversation.

The reason: any formal proposal to combine the agencies would spark fierce turf battles among congressmen on different committees that oversee each. Currently, the SEC regulates the creation and trading of corporate securities, while the CFTC regulates futures and options - including those pegged to stock-market indexes, Treasury bonds, currencies and other financial instruments.

The previous Treasury Secretary, Henry Paulson, did call for combining the SEC and CFTC as part of a regulatory reform plan he presented in March 2008. The idea still has its supporters. As recently as last week, SEC Chairwoman Mary Schapiro reportedly told lawmakers that "there is a logic and an efficiency that can be achieved through the merger of the two agencies."

CFTC Wants Hiring Binge

However, the story indicates that both the administration and Congress are more focused on how to best oversee products such as credit derivatives, that lie beyond the purview of either agency. Those responsibilities apparently will be shared between the two regulatory bodies.

The CFTC has ambitious expansion plans. But uncertainty over the administration's reform package appears to have put such designs on hold until now.

The agency has requested a 21 percent budget increase for 2010, to $177.7 million. Its newly confirmed Chairman Gary Gensler recently testified that the extra funds are needed to correct "alarming staffing levels that recently reached historic lows." CFTC employs 448 full-time staff and aims to add 100 more heads, or 23 percent, in the next year. Most planned new slots would require backgrounds in derivatives that are currently unregulated.

However, the CFTC Web site lists just two current openings Monday: a visiting academic fellow, and a supervisory information technology specialist.

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