Peterson, Frank Announce Derivatives Legislation Outline
House Financial Services Committee Chairman Barney Frank and House Agriculture Committee Chairman Collin C. Peterson today released a concept paper that will guide the two committees as they develop legislation to regulate derivatives. The text of the concept paper can be viewed by clicking here.
Chairman Peterson said: “I am pleased that Chairman Frank and I were able to come to agreement on so many principles with regard to OTC derivatives reform. I think we have come up with a responsible approach that bridges the differences between those members who want to completely eliminate the over-the-counter market and those who think that just greater transparency is all that is needed. Neither of those approaches is a real solution; what we are putting forth is.
“Putting this concept paper out now will give members of both Committees plenty of time to review it, develop ideas, suggestions, thoughts and comments so everyone will be prepared to tackle these issues when we return in September. I look forward to working with Chairman Frank so we can enact legislation that gives the American people the confidence that our markets are being overseen and monitored by strong, effective regulators.”
Chairman Frank said: “The fundamental purpose here is to improve the regulation of derivatives so that they continue to perform their important market function but are less likely to contribute to a kind of irresponsibility that can cause a crisis. Nobody here wants to ban them or even severely diminish them as an economic instrument. The Committee on Agriculture represents a lot of end users for whom they are very important. The Committee on Financial Services deals with a lot of the financial institutions. They have an interest that has to be blended. I thank Chairman Peterson and his staff for their cooperation on this effort.”