Dec. 17 (Bloomberg) -- Gary Gensler, a former U.S. treasury undersecretary and an ex-partner at Goldman Sachs Group Inc., will be named by President-elect Barack Obama to head the Commodity Futures Trading Commission, according to a Democratic official.

Gensler, 51, served as undersecretary for finance at Treasury during President Bill Clinton’s administration. More recently he was an economic adviser to New York Senator Hillary Clinton in her failed effort to win the Democratic nomination.

The Democratic official who said he is Obama’s choice for the commission spoke on condition of anonymity.

“Gary is a very smart, very knowledgeable and very experienced guy,” Geoffrey Aronow, former director of enforcement for the commission, said in an e-mail. “He would be a terrific choice to lead the CFTC at this critical time for addressing financial services regulatory reform.”

The commission oversees $5 trillion in futures and options trading, including oil and agricultural markets and foreign currency exchange. The agency has come under heightened scrutiny from Congress as lawmakers push for greater regulation of the $31 trillion credit-default swaps market, financial instruments blamed in part for the credit crisis.

The agency has also faced congressional inquiries into its capabilities during record price increases in energy and commodity markets. Oil futures prices touched a record $147.27 a barrel in July.

CFTC Probes

The commission has announced investigations in the last year into crude oil, cotton and silver markets.

Gensler’s nomination is scheduled to be announced tomorrow at a press conference in Chicago, alongside the nomination of Mary Schapiro to be chairman of the Securities and Exchange Commission, Obama transition officials said. Current SEC Chairman Christopher Cox has called for combining the two agencies.

Gensler declined comment when reached by phone today, referring questions to the president-elect’s transition spokesman. Obama spokesman Dan Pfeiffer didn’t respond to an e- mail and voicemail seeking comment.

If confirmed by the Senate, Gensler would replace Walter Lukken, who has served as acting chairman of the agency since June 2007. Lukken, a Republican, said Nov. 11 he would step down as head of the agency when Obama becomes president and would leave the agency soon after.

To contact the reporters on this story: Tina Seeley in Washington at tseeley@bloomberg.net; Hans Nichols in Washington at hnichols2@bloomberg.net.

Last Updated: December 17, 2008 21:48 EST