Within weeks, U.S. derivatives regulators approved a measure, dubbed the 'MF rule', designed to limit the kinds of transactions firms could make using client funds. The rule had been on the regulatory backburner as lobbyists sought to stall or alter new curbs proposed after the 2008 financial crisis.
Along with JPMorgan’s recent huge trading losses, MF Global’s case demonstrates that an army of Washington lobbyists seeking to roll back U.S. rules and regulations can undermine the interests of the businesses they serve.
'This is a classic example of how industry claims to know better than the bothersome bureaucrats in Washington', said Nancy Watzman, a consultant for the Sunlight Foundation, a Washington-based group that advocates open government records.
JPMorgan’s loss follows lobbying by its CEO, Jamie Dimon, to weaken the 2010 Dodd-Frank financial overhaul, which he has referred to as 'Dodd Frankenstein'.
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JPMorgan Joins MF Global In Lobbying Wins That Backfire
image: © Everaldo Coelho
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