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Speculation Rule Called Waste as Lawmakers Seek CFTC Accounting

Oct. 10 (Bloomberg) -- Speculation limits for oil, natural gas and other commodities that were blocked by a federal judge Sept. 28 reflect wasteful spending by the U.S. Commodity Futures Trading Commission, according to four House Republicans.

“The commission’s limited financial resources spent promulgating and defending the position limits rule demonstrates a serious mismanagement of the agency’s priorities,” Representatives Scott Garrett of New Jersey, Spencer Bachus of Alabama, and Jeb Hensarling and Randy Neugebauer, both of Texas, wrote in a letter to CFTC Chairman Gary Gensler today seeking an accounting of the costs.

The four Republicans asked the CFTC to provide the time spent on the position limits rule and the total amount it cost to complete the rule and defend it in court.

U.S. District Judge Robert Wilkins said in his Sept. 28 ruling that the CFTC failed to assess whether the limits imposed under the Dodd-Frank Act were necessary and appropriate. His decision blocked a measure scheduled to take effect Oct. 12 that was challenged by two industry groups that represent JPMorgan Chase & Co., Goldman Sachs Group Inc., Morgan Stanley and other banks and energy trading firms.

The CFTC is considering a recommendation by the agency’s general counsel’s office to appeal the judge’s ruling.

To contact the reporter on this story: Silla Brush in Washington at sbrush@bloomberg.net

To contact the editor responsible for this story: Maura Reynolds at mreynolds34@bloomberg.net

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