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Streetwise Professor

October 16, 2010

Wow.

Filed under: Commodities,Derivatives,Politics — The Professor @ 9:27 pm

I would have to say that this is unprecedented, at least I hope so:

Commodity Futures Trading Commission (CFTC) Administrative Law Judge George H. Painter made serious allegations regarding fellow CFTC judge Bruce Levine in announcing his retirement.In a notice sent to complainants and their attorneys, Judge Painter claims that Levine  told him that he had promised former CFTC Chair Wendy Gramm “that he would never rule in a complainants favor”. Painter’s notice goes on to say, “A review of his rulings will confirm that he has fulfilled his vow.”

In the notice Painter recommends the CFTC request the services of an administrative law judge to be detailed to the Commission from another regulatory agency to handle the remain cases on his docket. Painter writes, “If I simply announced my intention to retire, the seven reparation cases on my docket would be reassigned to the only other administrative law judge at the Commission, Judge Levine. This I could not do in good conscience.”

Yes, I’d say those charges are pretty serious, and disturbing.  Judges don’t, as a rule, criticize one another.  Things must have been pretty bad for Painter to break that rule.  But it doesn’t seem that in the end it will have a real effect.

Painter’s criticisms are limited to reparations cases (basically cases where customers of brokerage firms claim their brokers have failed in their duties towards them, and cost them money).  But he raises questions about the possibility of an ideological bias that could have affected decisions in other cases too.

I have been involved in a couple of Levine’s cases.  I’ve heard stories, but this is neither the time nor the place.  I would hope that there is some mechanism for investigating Painter’s allegations, and either clearing Judge Levine’s name if they are baseless, or holding him accountable if they are not.

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13 Comments »

  1. …and I am sure there are judges who never vote in favor of black people..

    Comment by Surya — October 16, 2010 @ 10:56 pm

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    Pingback by Links 10/17/10 « naked capitalism — October 16, 2010 @ 11:59 pm

  3. Levine’s behavior — I’m sure Painter is correct — would be Republican Standard Practice these days.

    We do ot have rule of law in this country any more. Is there a party agitating to bring it back?

    Comment by Anon. — October 17, 2010 @ 3:08 am

  4. Well, Phil and Wendy Gramm have made a career out of turning the US financial services sector into a protection racket for their very rich corporate friends, so nobody should be surprised. Putting someone like Wendy Gramm in charge of the CFTC was a bit like putting Al Capone in charge of Elliott Ness and the ‘Untouchables’ – such a blatant, criminal conflict of interest that it couldn’t happen anywhere except in the Crony Capitalist Wonderland that is the USA…

    Comment by Jon — October 17, 2010 @ 10:13 am

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    Pingback by Tweets that mention Streetwise Professor » Wow. -- Topsy.com — October 17, 2010 @ 1:27 pm

  6. Wendy Gramm. It figures. Her and Phil, a “one-two punch” in favor of plutocracy.

    Wonder why she wanted such a promise, and what inducement she offered.

    Comment by rkka — October 17, 2010 @ 1:53 pm

  7. Wasn’t there a WSJ story several years ago about this judge, stating the astonishing fact that he never ruled for complainants? Meaning, not that the vast majority of his complaints were against complainants, but literally every single one?

    Comment by moboddo — October 17, 2010 @ 3:25 pm

  8. Yes, moboddo. Painter attached that article to his resignation letter.

    The ProfessorComment by The Professor — October 17, 2010 @ 6:33 pm

  9. Five or ten years ago I might have been astonished at something like this. Now it’s just one more grain of sand. From the fraud pipeline that is the MBS industry, to the Iraq War, to Enron, to etc., etc., etc. I have no faith left in this nation or its institutions. I have no faith left in either major party and damn little faith in the minor parties. The honest are punished and the wicked paid handsomely yet I have no desire to join the wicked. What is one to do except trash it all and hope something better rises from the ashes?

    Comment by Keith — October 17, 2010 @ 7:45 pm

  10. As I have often said, If we want to reform the markets, we first have to reform the regulators. Sadly, the people with the ability to effect change have no desire to see anything changed.

    Comment by Charles — October 18, 2010 @ 10:37 am

  11. The question is, what’s in it for Levine?

    We know what the Gramms got for their obedience: Phil’s lucrative job at UBS, among (I assume) other things.

    What’s Levine getting out of it?

    Comment by Jon H — October 18, 2010 @ 3:15 pm

  12. Levin’s pledge, if there was one, was made long before Phil Gramm went to UBS. As to what Levine is getting out of it, I doubt we’ll ever know.

    The ProfessorComment by The Professor — October 18, 2010 @ 7:44 pm

  13. Hmm…looks like folks like these would have their counterparts in regulators like SEC and CFTC. And I am sure they can put up obstacles to making things like manipulation more difficult by clubbing it with fraud….just wondering…how much of the lack of clear rules have to do with ignorance and how much to lack of will

    Comment by Surya — October 19, 2010 @ 10:03 am

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