The U.S. Commodity Futures Trading Commission should move to ease bottlenecks at aluminum warehouses as it bolsters oversight of banks’ trading and storage of commodities, Senator Sherrod Brown said today.
The CFTC “must take a more aggressive stance” to rein in banks’ role in the markets, Brown said in a statement after meeting with Sharon Y. Bowen and J. Christopher Giancarlo, who are awaiting Senate confirmation to serve on the commission.
“There seems to be no clear benefit to the economy from banks owning assets like warehouses, tankers, pipelines, and coal mines,” said Brown, an Ohio Democrat who has held hearings on the issue.
U.S. regulators including the Federal Reserve and CFTC have been reviewing banks’ involvement in commodity markets. The CFTC issued subpoenas last year to Goldman Sachs Group Inc., JPMorgan Chase & Co. and other metal-warehouse operators after brewer MillerCoors LLC and others complained of long waits for materials.
The Fed sought comment Jan. 14 on the risks posed by ownership and trading of commodities such as oil, gas and aluminum by deposit-taking banks and the possible benefits of imposing additional capital standards.
The Fed’s review was criticized by Brown and Senator Elizabeth Warren, a Massachusetts Democrat, who said the action didn’t go far enough.