Giancarlo Said to Be Trump’s Leading Choice for CFTC Chair

  • Commissioner with ties to swaps firms could be nominated soon
  • If picked, Giancarlo expected to help roll back some rules

J. Christopher Giancarlo, a member of the Commodity Futures Trading Commission with close ties to the derivatives industry, is President-elect Donald Trump’s top choice to head the U.S.’s main swaps regulator, a person familiar with the matter said.

Giancarlo, currently the CFTC’s only Republican, has been in the mix to lead the agency for weeks but his front-runner status has recently solidified. He is also expected to be named interim chairman in the coming days.

Trump said on Wednesday that he will nominate Wall Street lawyer Jay Clayton to lead the Securities and Exchange Commission, the industry’s main regulator, stoking speculation that a CFTC announcement could come soon. Giancarlo has been vetted by Trump’s team and has spoken with people involved in the transition, said another person with knowledge of the matter.

Trump’s CFTC chairman is expected to play a pivotal role in rolling back some rules dictated by the Dodd-Frank Act, which called for broad government oversight of swaps after unregulated trades helped fuel the 2008 financial crisis. Giancarlo has argued that in some areas the CFTC went further than lawmakers intended. Trump’s transition team has promised to dismantle Dodd-Frank.

Excessive Regulation

Giancarlo frequently cites his industry experience as informing his approach to regulation. In a speech before the American Enterprise Institute in September, for example, he said his work as an executive taught him that “unbalanced regulation is a major contributor to America’s economic doldrums.” He worked at a swaps brokerage before joining the CFTC as a commissioner in 2014.

Through a representative, Giancarlo declined to comment.

Recent disputes over CFTC rules indicate where Giancarlo might guide the agency on major issues. In a fight over a proposal that would give the regulator easier access to high-frequency traders’ secret trading codes, he sided with industry in opposing the plan and called it a “giant lurch backward in undoing Americans’ legal and civil and constitutional rights.”

Giancarlo said last month that he was pleased that current Chairman Timothy Massad chose not to finalize controversial rules to limit traders’ ability to speculate on oil and other commodities. While Giancarlo said a re-proposed version could be the basis for a final rule, the eventual fate of the limits, which were backed by Democrats, is unclear.

On Tuesday, Massad said he plans to step down from the post Jan. 20, clearing the way for Trump to replace him. When Massad leaves the agency a few weeks after giving up the helm, Trump will get to fill three open seats to bring the five-member panel to full strength.

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