Senators blast CFTC, Gensler for MF Global mess

[WestVirginiaRebel]

Reuters:

(Reuters) - Republican lawmakers blasted the chairman of the U.S. futures regulator on Thursday for his agency's role in the collapse of MF Global and called his recusal from the investigation a way to "avoid the heat."

The Commodity Futures Trading Commission and its chairman, Gary Gensler, are under pressure because of the quick collapse of the futures brokerage and for allegedly not policing the firm's bookkeeping closely enough.

Investigators are searching for as much as $1.2 billion in missing customer money, which regulators have said the firm may have diverted for its own needs.

Gensler recused himself from the CFTC's probe into MF Global after it filed for bankruptcy on October 31. Gensler and Jon Corzine, who resigned as chief executive of MF Global last month, worked together at Goldman Sachs Group Inc in the 1990s.

"It looks to me like you're trying to avoid the heat," Senator Mike Johanns, a Republican, said of Gensler's decision to remove himself from the MF Global investigation. "You certainly didn't recuse yourself all of the other weeks and months and days while MF Global was doing what it was doing."

Gensler defended himself before the Senate Agriculture Committee, saying that, while he did not recuse himself immediately, he did so as soon as the CFTC prepared for possible civil and criminal charges.

"Lawyers assured me there was no legal or ethical reasons, but I thought it could be a distraction in the media and the press," Gensler told lawmakers.
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Covering one's ass is hard work...