David Meister, a former prosecutor from the United States Attorney’s Office for the Southern District of New York will head the CFTC’s enforcement division. Five years ago this would not even be worthy of a news blip. But today, CFTC’s enforcement powers have greatly expanded thanks to the Dodd-Frank financial reform bill. The CFTC is in a prime position to effect positive change. They are counting on Meister and his strong enforcement background to secure a sense of integrity and stability in our sophisticated commodities markets which have evolved well beyond pork belly and soybean futures, but too often have a reputation of functioning more like a poker saloon in the Wild West.
Significantly, the Dodd-Frank financial reform bill increased the types of claims the CFTC can pursue and also broadened the agency’s jurisdictional reach. Perhaps most importantly, the expanded CFTC will have increased powers to govern the multi-trillion dollar derivatives market. A market that almost single handedly pushed us into a second great depression.
Oh how times change. The brave Brooksley Born, former head of the CFTC, tried regulating derivatives (long before the financial meltdown of 2008) and was literally strong armed by Hank Paulsen and Alan Greenspan to keep her mouth shut. The CFTC will now monitor derivatives in the same way that the SEC monitors securities – a major step forward from the old, nearly-deregulated system. Dodd-Frank gives the CFTC broader authority to pursue manipulation in the markets by broadening the definition of “manipulative conduct” and by including swaps in the CFTC’s purview. Finally, the CFTC will have added control over insider trading enforcement, and will set “business conduct requirements” to ensure a minimum level of accountability.
David Meister has commendable experience making tough decisions, investigating complex corporate fraud, and – most importantly – winning at trial. Meister, 47 years old, has over 20 years of white collar litigation experience. He spent time as a prosecutor in the Southern District of New York as a member of the Securities and Commodities Fraud Task Force. Meister further enhanced his credentials working for one of the world’s largest law firms – Skadden, Arps, Slate, Meagher, & Flom (aka “Skadden”). At Skadden, Meister represented numerous individuals and corporations in matters involving securities litigation, insider trading, and complex accounting. Let’s hope though, in that rarified world of top Wall Street law firms, he hasn’t forgotten the investors on main street. Because as we all know, they are the ones who need protection. The little guys are often left to fend for themselves, Institutions can afford to hire – well – Skadden Arps.
Assisted by Zachary Kady