UPDATE 2-U.S. derivatives regulator names ex-prosecutor as enforcement head

Tue Jun 10, 2014 3:00pm EDT

(Adds background on current CFTC cases)

WASHINGTON, June 10 (Reuters) - The U.S. derivatives regulator on Tuesday named a former federal prosecutor and experienced trial lawyer as its new enforcement head, a rapid hire only days after the agency's new chairman started his job.

The Commodity Futures Trading Commission said it had appointed Aitan Goelman, a litigation partner at law firm Zuckerman Spaeder, as the regulator's new director of the Division of Enforcement.

Goelman rose to some fame as one of the trial lawyers that won conviction of Oklahoma City bombers Timothy McVeigh and Terry Nichols for a 1995 truck bomb attack on the federal government that killed 168 people.

"He will be a tough, aggressive and fair leader at a critical time in the commission's history," CFTC Chairman Timothy Massad said in a statement.

Massad, a former senior Treasury official, was himself sworn in as the new head of the derivatives regulator on Thursday, two days after the Senate gave him the green light.

Goelman previously was a former assistant U.S. attorney in the Southern District of New York and a special attorney to the U.S. Attorney General, the CFTC said.

The CFTC has sued a number of high-profile defendants in the past few years - most notably Jon Corzine, the former head of collapsed futures brokerage MF Global - and will either have to litigate those cases or settle them.

It was put in charge of the U.S. part of the $710 trillion swaps market in 2010, giving it a far bigger remit than before the 2008 financial crisis when it only oversaw agricultural and other futures markets.

Goelman takes over from Gretchen Lowe, who was acting division head after the departure of David Meister, who forced a number of record settlements on large Wall Street banks over accusations they fixed the Libor interest rate benchmark.

Several more Libor cases are in the works. The CFTC is also probing markets for possible manipulation of another widely used benchmark underlying swaps contracts, the so-called ISDAfix rate, and a number of other instruments.

Other than the case against Corzine, it has also filed a complaint against Royal Bank of Canada for an unlawful trading scheme to realize tax benefits, and against CME Group Inc for leaking details on client trades.

The CFTC often settles cases with defendants, and has gone to trial only three times since 2011, all in minor cases. It has won all those cases.

Separately on Tuesday, the CFTC agreed in principle to settle its oil manipulation case against two firms, Arcadia Petroleum and Parnon Energy, taking a step closer to ending a high-profile multi-year lawsuit. (Reporting by Douwe Miedema; Editing by Eric Beech)