Timothy Massad said he plans to step down as Commodity Futures Trading Commission chairman on Jan. 20, clearing the way for Republican control of the top U.S. swaps regulator as President-elect Donald Trump takes office.
Massad will stay on as a CFTC commissioner for a few weeks “to close out his office and handle administrative matters,” the agency said in a statement Tuesday.
A former Treasury Department official and corporate lawyer, Massad took over the CFTC in 2014 as it was being transformed after the financial crisis from a sleepy regulator of agricultural futures to a front-line Wall Street cop. He continued the progress of his sharp-elbowed, better-known predecessor Gary Gensler, completing Dodd-Frank Act rules that brought swaps under broad government oversight for the first time.
During Massad’s tenure, the agency passed stepped-up collateral requirements for swaps, increased oversight of clearinghouses that sit at the heart of the market and worked to ease the burden of certain rules on agricultural, energy and other end users of derivatives. But on one of the key provisions of the 2010 law, curbing speculation in commodities, Massad failed to muster support to complete a final rule, leaving any resolution to his successor.
Throughout, Massad has remained a strong backer of Dodd-Frank and the rules it required to boost transparency to the market for over-the-counter derivatives, products that were at the heart of the 2008 meltdown. In a Dec. 6 speech in New York, he urged the incoming administration to reconsider its pledge to undo parts of the law.
“There’s a wide consensus that the reforms made to bring transparency and oversight to the swaps market made sense, and therefore it would be a mistake to significantly change them,” he said at the Economic Club of New York. “Those who supported President-elect Trump because of his promises to working-class voters, many of whom may believe the government has been captured by powerful interests, will have been sold a bill of goods if wholesale repeal of Dodd-Frank is made out to be a critical part of the solution to concerns about economic stagnation or lack of opportunity.”
In announcing his resignation, Massad, 60, is following a standard track for heads of independent federal agencies who typically step down when a president from a different party is inaugurated. He follows Securities and Exchange Commission Chair Mary Jo White, who said in November she would leave at the end of the Obama administration.
Aside from the new regulations, Massad’s other legacy may be his inability to persuade Congress to significantly raise the CFTC’s languishing budget — a longstanding problem that he often complained about in public speeches.