The CFTC story
June 24, 2009
Some interesting facts I didn’t know:
- Sheila Bair tried to stop Wendy Gramm.
- Gramm went straight from CFTC chair to Enron’s board of directors.
From a great post at the HuffPo:
In the 1990s, the CFTC began allowing many privately negotiated derivatives, or so-called over-the-counter contracts, to escape regulation.
Wendy Gramm, CFTC chair from 1988 to 1993 and wife of former Texas Senator Phil Gramm, supported a rule change in 1992 that loosened the energy trading industry for companies like Enron. Sheila Bair, then a commissioner at the CFTC and now director of the FDIC, cast the lone dissenting vote at the commission, saying the plan “sets a dangerous precedent.”
Five weeks later, after resigning from the CFTC, Wendy Gramm joined Enron’s board of directors. The gig was lucrative. According to the watchdog group Public Citizen, over the course of the following eight years, Enron paid her between $915,000 and $1.85 million.