The CFTC has been forced to halt a program that might have alerted regulators to suspicious trades because of an $11 million cut in its tech budget, the Wall Street Journal reported.And the massive funding shortages at the futures regulator are apparently causing bitter fights within the agency.
Republicans want to spend more on technology. Democrats, on the other hand, “would rather use funds to increase staff by 46%,” the WSJ said.
The CFTC’s chairman, Gary Gensler, is leading the Democratic pack.
Congress flatly refuses to raise both the CFTC and the SEC’s funding to handle a ton of new mandates that are the result of Dodd-Frank, despite their own continuing public vitriol against predatory lenders and Wall Street paychecks.
“We finally got the authority we needed and now we’re not going to be able to use it,” one regulator said.
“If the requested budget increases are not granted, we will manage within our allocated resources but we’ll face a lot of bad choices,” a Democrat SEC commissioner told the WSJ.
One of those bad choices is the CFTC’s decision to abandon the expansion of an automated surveillance system that would be able to flag suspicious trades of futures.
For the SEC, a ban on nonessential travel has seen a number of investigations simply stop midway through.