O'Malia slams CFTC over tech investment
06 March 2014 | 2879 views | 0
Commodity Futures Trading Commission commissioner Scott O'Malia has slammed his own organisation for spending money on people, rather than technology.
Earlier this week President Obama proposed a budget of $280 million for the CFTC in 2015, less than the $315 million he asked for in fiscal 2014 (although more than the $215 million that was eventually granted).
Democrat CFTC commissioner Bart Chilton called the proposal "woefully insufficient" at time when the watchdog is taking on oversight of a large swath of the swaps market.
Chilton says that the CFTC desperately needs to hire more people, insisting that "our staff is on its knees".
The body's technology people may not being able to support implementing the regular collection of key data in the marketplace says the commissioner, adding: "I am fearful to say where, so as not to tip off market participants, but our coverage will not be as robust or comprehensive as is required."
Chilton's fellow commissioner, Republican Scott O'Malia has now waded into the debate, deriding the CFTC's "futile strategy of hiring more staff to oversee a vastly complex, high-speed and technology-driven market".
O'Malia says that the CFTC consistently makes poor use of its funds, increasing data and technology spending by just 6.8% between 2011 and 2014, compared to an overall budget rise of 11.7% during the same period.
The commissioner argues that the $50 million for non full-time-equivalent technology investments is unacceptable. And worse, of this $50 million only $10.5 million is for "cutting edge tools that are essential to the Commission's long-term regulatory mission".
He says that the current funding plan will now see another year wasted without the deployment of critical technology, such as an order message data collection and analysis system.
He wants the CFTC to focus on three key areas of technology-related investment: improving swaps data quality, developing additional automated surveillance tools, and developing automated risk analytics.