Gary Gensler, the chairman of the Commodity Futures Trading Commission, took heat from Senators on Tuesday for recusing himself from investigating the failed brokerage firm MF Global.
Sens. Tim Johnson (D-S.D.) and Richard Shelby (R-Ala.), the chairman and the ranking member of the Senate Banking Committee, blasted Gensler during the committee’s hearing on Dodd-Frank Act oversight on Tuesday, according to AdvisorOne.com.
Shelby said the CFTC’s failed regulation of MF Global is a vivid demonstration of how providing regulators with more tools and powers cannot help when regulators fail to do their jobs.
Gensler told committee members that his recusal was appropriate because the investigation of MF Global became an enforcement matter that focused on his former boss at Goldman Sachs, Jon Corzine.
“I didn’t want my participation to be a distraction,” Gensler said, AdvisorOne.com reports.
Sen. Mike Johanns (R-Neb.) scoffed at Gensler’s reasoning.
“What it feels like up here is that when this [investigation] got uncomfortable because money isn’t there that should be there, you don’t want to come up here and answer questions. To me it looks like you’re ducking the responsibilities of your job,” Johanns said, according to AdvisorOne.com.
Shelby requested that the CFTC’s inspector general determine whether Gensler’s recusal was warranted or if he should have recused himself much earlier in the process.