US should publicize energy trader positions -group

Wed Aug 31, 2011 4:07pm EDT

* Public Citizen urges two-week delay for sensitive data

* Sen. Sanders hopes to push CFTC on position limits

* FIA says info release shook market confidence

By Christopher Doering

WASHINGTON, Aug 31 (Reuters) - The U.S. futures regulator should be required to make public the size and nature of energy trader positions each week, a consumer advocacy group said on Wednesday, the latest call to change the way market-sensitive data is handled.

Tyson Slocum, director of Public Citizen's energy program, said in a letter the group recognizes that daily disclosure of trading position data would be problematic, so it proposed that company-specific data be released by the Commodity Futures Trading Commission two weeks after the daily close.

"Such a delay should be more than adequate to protect traders' interests while providing the public access to the key players involved in energy futures' markets," said Slocum.

The group's recommendation would exceed the tranparency required by the Dodd-Frank financial markets reform that the CFTC has been implementing, and also would go beyond the disclosure requirements for the U.S. stock market.

The letter was sent to Gary Gensler, the head of the CFTC, and to the top Republicans and Democrats on the Senate and House Agriculture committees, which oversee the futures regulator.

A CFTC spokesman could not be reached for comment.

The request comes two weeks after Sen. Bernie Sanders released data showing the names and energy positions held by more than 200 speculators, including Goldman Sachs (GS.N) and Morgan Stanley (MS.N), in the run-up to record high prices in 2008.

Sanders, a Vermont Independent, said he felt the data needed to be made public and hoped the release would push the CFTC to eliminate excessive speculation as it is required to do by law.

His release of the oil data drew criticism from the Futures Industry Association, which last week asked the CFTC to investigate and determine whether any laws were broken.

Current regulations require futures market participants to submit data anonymously to regulators. The CFTC then publishes a weekly commodity market report. It categorizes the data by trader type, such as swap dealer, but does not identify the individual trader. Slocum asked that the specific trader positions be included in this report.

In comparison, in the U.S. equity markets whenever an investor accumulates 5 percent or more of a company's stock, the position must be disclosed within 10 days.

Hedge funds are required to release 13-F filings detailing their stock market positions on a quarterly basis, 45 days after the end of the period.

The Futures Industry Association complained that the senator's release of the information "poses a serious threat to the confidence" by market participants in the CFTC to protect proprietary data and raises troubling questions about the ability of Congress to handle the information.

The CFTC is legally prohibited from releasing confidential information that identifies trader positions and identities.

By law, the CFTC must hand over such information if a Congressional committee acting within its proper authority requests it. There is nothing to prevent lawmakers from releasing it to the public. (Editing by David Gregorio)

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