By Julian Hattem - 11/12/13 06:00 AM EST
President Obama will nominate Timothy Massad, who has spent the last three years overseeing the federal bank bailout program, to be the next chairman of the Commodity Futures Trading Commission (CFTC) on Tuesday, the White House announced.
As head of the small but powerful regulatory agency, Massad would be in charge of overseeing the $300 trillion derivatives market as well as speculation of commodities like oil and natural gas.
If confirmed by the Senate, Massad, would replace Gary Gensler. Gensler is stepping down at the end of the year, after a term that began in 2009.
“Tim Massad is the right person to lead the CFTC at this important time for our economy and financial markets,” the White House said in a statement ahead of the nomination.
Though his term officially ended in 2012, government rules have allowed Gensler to stay on the agency until the end of this year.
As CFTC chairman, Gensler issued scores of Dodd-Frank regulations to rein in the market for complex derivatives trades, which were blamed for contributing to the financial crisis but were previously largely unregulated.
Massad is currently the Treasury Department’s assistant secretary for financial stability. In the post, he managed the department’s $700 billion bank bailout regime, the Troubled Asset Relief Program (TARP), as it unwound investments made during the financial crisis.
“Under his watch, nearly every taxpayer dollar has been repaid in full by the banks, and the program has even turned close to a $30 billion profit for the American taxpayer,” the White House said.
He also worked on the watchdog Congressional Oversight Panel, which was run by now-Sen. Elizabeth Warren (D-Mass.), to oversee the bailout.
Before entering government, Massad spent 25 years at the New York-based Cravath, Swaine and Moore law firm, a position that gave him “extensive knowledge of the derivatives market,” the White House said.
During the nomination on Tuesday, Obama will also call on Congress to increase funding for the CFTC, according to the White House’s announcement.
The agency has long complained that it does not have the funding it needs to successfully carry out its growing oversight mission. Its current budget is $195 million, but Obama has wanted to increase it to $315 million in the next fiscal year.
The five-chair CFTC is currently operating with just four commissioners. It will be reduced to three when Bart Chilton, a Democratic commissioner, steps down later this year.