US finance agencies poised for leadership shakeup

Two top financial and commodity trading regulators plan to step down in the coming months, but are wrapping up unfinished business before president-elect Joe Biden appoints new leaders.

US Commodity Futures Trading Commission (CFTC) chairman Heath Tarbert said today he will resign as chairman "early next year." The agency has completed a number of high-profile rules during Tarbert's 17 months on the job, fulfilling congressional mandates the agency has faced for years under the 2010 Dodd-Frank financial overhaul law.

"With the agenda I laid out last year now complete, the commission can fully turn its focus to the unwritten future," said Tarbert.

Biden, upon taking office on 20 January, is expected to designate a new chairman for the CFTC from one of the agency's two Democratic commissioners, Dan Berkovitz or Rustin Behnam, but has not yet named his pick. The new chairman will be able to take over immediately without requiring confirmation from the US Senate.

The CFTC at that point could still have a 3-2 Republican majority if no commissioners have resigned. But Republican commissioner Brian Quintenz months ago announced his intent to leave the agency as early as this year, if a successor could be found. Tarbert has not said how long he intends to remain at the agency once he steps down as chairman.

The US Securities and Exchange Commission (SEC) will also soon go through a leadership change when agency chairman Jay Clayton steps down later this month, which will leave the agency with a 2-2 split between Republican and Democratic members. But before that happens, the agency is preparing a last-minute vote on a controversial rule affecting oil and gas companies.

The SEC has scheduled a vote on 16 December to finalize its so-called "section 1504" rule, which would require publicly traded oil and gas companies to start disclosing more information on royalty, tax and other payments to governments. The rule is intended to prevent government corruption tied to resource extraction.

But critics say the SEC, under pressure from US oil companies, has watered down the rule so much that it will fall well short of its intended purpose and be weaker than corresponding rules of other countries. If the agency issues a rule without requiring strong disclosure, "it will be one final giveaway from a corrupt administration to a dying industry," Publish What You Pay US director Kathleen Brophy said.

By Chris Knight