Lukken calls for regulatory overhaul as he prepares to step down

Lukken said that, as a political appointee, he would step down as acting chairman at or before the inauguration of President-elect Barack Obama on January 20, 2009 and would leave the CFTC shortly afterwards.

He supported the US Treasury's plan for a three-part regulatory framework - consisting of offices responsible for systemic risk, market integrity and investor protection - in place of the present arrangement, but reiterated his earlier opposition to the proposed merger of the CFTC and the Securities and Exchange Commission.

"This is code for the larger SEC - along with its rules-based model and culture -taking over the principles-based CFTC. In my view, this would be ineffective and would only reinforce our outdated regulatory structure. Simple merger is a recycled idea when bold solutions are needed," he said.

Instead, while the regulatory structure is overhauled, the government should create a national regulatory board, comprising the heads of the Federal Reserve, the CFTC and the SEC, he said.

He also supported efforts to create a central counterparty for over-the-counter credit derivative trades, and advocated a global standard for sharing market data between national regulators.

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