White House budget boosts market regulators' funds

* SEC budget up 10.3 pct under Obama plan

* CFTC budget up 28 pct under Obama plan

* Plan includes funding for financial reforms

WASHINGTON, Feb 1 (Reuters) - The White House proposed giving market regulators more funding to examine and police Wall Street as the government struggles to hold those accountable for the worst financial crisis in decades.

Under the Obama administration's fiscal 2011 budget, the Securities and Exchange Commission would get a 10.3 percent increase in funding and the Commodity Futures Trading Commission's budget would increase by 28 percent.

The White House also proposed nearly $1 billion in additional funds for various regulators, contingent on Congress passing legislation to reform the country's financial regulation.

That includes funds for the Treasury Department to deal with financial risk that could threaten the wider economy, and funds for the housing department and Federal Trade Commission to help the controversial Consumer Financial Protection Agency -- a key piece of the Obama administration's financial reform proposal.

A placeholder of $857 million has been set aside to give the Federal Deposit Insurance Corp starting money to resolve any failing financial firms that pose a systemic risk. Those funds are contingent on Congress passing legislation that gives the FDIC "resolution authority" for large, troubled firms and authorizes the agency to recoup any costs through risk-based assessments on financial firms.

The significant increases to the SEC and CFTC budgets represent a departure from the deregulatory years under President George W. Bush.

Congress is attempting to sharpen regulators' powers through a large package of reforms, including the creation of a systemic risk regulator, enhanced policing of derivatives, the formation of the new consumer agency, and consolidation of bank regulators, among other reforms.

The House of Representatives has passed a version of the reforms that largely resembles the Obama administration's proposal. The Senate has been slower to act, hoping to craft a bipartisan version of the legislation.

Under Obama's budget proposal, the SEC, which oversees financial players and equity markets, would see its budget increase to $1.235 billion from the estimated 2010 allotment of $1.12 billion.

The SEC's enforcement division, which has been criticized for missing Bernard Madoff's epic investment fraud, would get almost a 10 percent budget increase. The SEC's office of inspections and examinations -- responsible for examining thousands of broker-dealers and investment advisers -- would get a budget boost of 8.7 percent.

"Continued investment in technology is also a top priority for the division, as it will enable the staff to work more efficiently and effectively," the administration said in its 2011 budget proposal.

The CFTC, which oversees trading in financial, energy, agricultural and metals futures, would see its budget increase to $216 million from $168.8 million. Most of the increase -- $45 million -- would pay for new information systems and an additional 119 employees. (Reporting by Rachelle Younglai, Tom Doggett, Karey Wutkowski; editing by John Wallace)