On January 3, 2017, Timothy G. Massad announced that he will step down as chairman of the Commodity Futures Trading Commission (“CFTC” or “Commission”) on Inauguration Day, January 20, 2017.  Chairman Massad’s announcement also notes that he will also step down as a Commissioner after a few weeks.

President Barack Obama nominated Chairman Massad to head the Commission on November 12, 2013, and the U.S. Senate confirmed him on June 3, 2014.  His tenure has focused largely on the implementation and enforcement of the Dodd-Frank Wall Street Reform and Consumer Protection Act through reforms to the over-the-counter swap market.

As we discussed previously, the transition to the Trump Administration is likely to have a significant impact on the regulatory agenda of the CFTC, particularly with the proposed, but not finalized, rules on position limits, automated trading, and swap dealer capital requirements for non-banks.  Commissioner J. Christopher Giancarlo is reportedly the frontrunner for nomination to the chairmanship.  We expect that once Chairman Massad steps down this month, Commissioner Giancarlo will be named the acting chair. Commissioner Giancarlo has been a vocal critic of a number of the proposed and final rules issued during Chairman Massad’s tenure.  With two of the Commission’s five posts already vacant, Chairman Massad’s departure will enable the Trump Administration to significantly reshape the agency, and potentially its policy direction, with commissioners of its choice.  However, the CFTC’s governing statute prohibits more than three commissioners from being members of the same political party.  Commissioner Giancarlo, a Republican, currently serves alongside Commissioner Sharon Bowen, a Democrat.