Senators decry regulators’ turf war

{mosads}In April, Sens. Dianne Feinstein (D-Calif.), Ron Wyden (D-Ore.) and Lisa Murkowski (R-Alaska) sent a letter to the agencies asking them to sign formal memoranda of understanding to work out their differences. 

A recent response from FERC Chairman Jon Wellinghoff said that, though he wants to broaden collaboration with the CFTC, they have been unwilling to share information as requested.

“Unfortunately, in developing the new information sharing [memorandum of understanding] required by Dodd-Frank, the two agencies disagree over whether the CFTC should provide FERC with certain data that we believe is critical to our surveillance program to detect and deter energy market manipulation,” he wrote in an Aug. 29 letter. 

The senators are not happy to hear that the trading commission seems to be stonewalling FERC’s efforts.

“In the Dodd-Frank Act, Congress directed CFTC and FERC to cooperate in order to protect American consumers from manipulation, so it is unconscionable the CFTC would be unwilling to share this essential information with FERC,” Feinstein said in a statement on Friday.

This summer, FERC announced that it was fining JPMorgan Chase $410 million to settle charges that it manipulated energy markets in California and the Midwest. 

Wyden praised enforcement actions like that one, but said that “it appears that their federal counterparts at the CFTC have been working to undermine FERC’s efforts.”

Among the disagreements between the two agencies are whether the regulatory commission has the authority to crack down on effects in the energy sector from financial market manipulation.

In his letter, Wellinghoff said that he supports “a legislative fix to eliminate uncertainty on this matter and ensure that FERC has the full authority needed to police manipulation of wholesale physical natural gas and electric markets.”

Wyden, the chairman of the Energy and Natural Resources Committee, said he will speak with fellow lawmakers to force the two agencies to get along. Feinstein leads the Appropriations subcommittee on Energy and Water Development.