The federal agency charged with guarding against abuses in the commodities markets is facing questions about its own excesses.
The U.S. Commodity Futures Trading Commission has tripled its budget since 2008, increasing its payroll by $50 million over the last two years alone while handing out $1.2 million in bonuses and even lining up a contractor to reward its employees with $50 gift cards.
And the independent federal agency, which is free from the normal civil service system compensation limits, pays a whopping 82 percent of its employees a six-figure salary.
The agency defends its spending, saying its responsibilities have grown substantially since the financial crisis in 2007-08 and that attracting talent with expertise in commodities is expensive. And, it adds, it buys gift cards for its best employees only occasionally.
The CFTC’s explanation, however, doesn’t sit well with some key members of Congress who are dubious about the agency’s latest budget request seeking an increase to $315 million in 2014 at a time when other federal budgets are shrinking from sequester budget cuts. House Republicans, in fact, voted Thursday to cut the CFTC budget nearly in half to $194 million.
““This requested funding level has to be called into question given the current fiscal environment that we are in,” Rep. Jack Kingston, R-Ga., declared in exasperation during a hearing last year.
For taking full advantage of the opportunity to write itself a blank check covering big salaries, bonuses and gift cards, CFTC wins this week’s Golden Hammer, a distinction awarded by the Washington Guardian to examples of excessive government spending.
CFTC officials declined to address the specifics of its spending, instead referring a reporter to agency speeches and testimony from CFTC Chairman Gary Gensler.
“We recognize that the federal government is operating under a sequester, and that budgets for agencies across government require additional scrutiny,” Gensler said in prepared remarks in April to Congress. “Our mission, however, has expanded dramatically. We have a duty to help protect the economy and taxpayers from risks in the financial system.”
Gensler’s nod to frugality, however, contrasts with the agency’s own reward system. It handed down roughly $1.2 million in bonuses last year, an amount that puts it on par with the Federal Trade Commission – an agency with twice the number of employees.
Almost every federal agency follows a particular federal pay scale. CFTC does not. It was given an exception to the rule under the Farm Security and Rural Investment Act of 2002.
The bill gives the CFTC the power to “fix the compensation of such officers, attorneys, economists, examiners, and other employees as may be necessary for carrying out the functions of the Commission” and “without regard” to other federal pay regulations.
The agency has taken full advantage: it pays the majority of its 700 workers between $100,000 and $200,000. The average federal salary is just $80,000.
CFTC since 2008 also has kept a contract with GiftCertificates.com to arrange $50 gift cards to reward its employees. The agency says, however, it uses that perk sparingly. It spent only about $1,000 on gifts cards in the first six months of fiscal 2012, the latest figures it provided Congress.
The agency’s spending records also have hints of other excesses, like frequent charges for car washes, a $1,700 single meal at Washington’s glitzy Smith & Wollensky steakhouse that was charged to taxpayers, and thousands of dollars for various catering.