CFTC Calls For Legislative Fix Of Zelener Loophole

Law360, New York (June 1, 2009, 12:00 AM EDT) -- At a House hearing Thursday, a top official of the U.S. Commodity Futures Trading Commission urged lawmakers to close a loophole created by a 2004 appeals court decision the agency says has encouraged the growth of boiler rooms dealing in potentially fraudulent commodity contracts, and allowed them to evade federal regulators.

Stephen Jay Obie, acting director of the CFTC's division of enforcement, said a fix passed by Congress as part of the 2008 farm bill did not go far enough, and said a broader patch was...
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