WASHINGTON, July 30 (Reuters) - Pressure on U.S. futures
regulators to launch an official probe of the aluminum market
mounted on Tuesday, when the head of the Senate Agriculture
Committee asked the Commodity Futures Trading Commission to
review alleged manipulation.
Chairwoman Debbie Stabenow noted that in congressional
testimony last week, buyers of aluminum alleged that the current
market price was being skewed by those who own and profit from
the storage of metal at warehouses.
"I am writing to encourage you to further review this issue
and clarify the role and responsibility of the Commodity Futures
Trading Commission to address the situation," Stabenow wrote to
CFTC Chairman Gary Gensler.
Last week, the CFTC put Wall Street banks and other big
traders on notice for a possible investigation of their metals
warehousing businesses, following years of complaints about
The request to firms to preserve relevant documents from the
past three years appeared to stop short of a formal CFTC probe,
one of the sources to receive the letters told Reuters.
Stabenow asked Gensler to clarify aspects of the CFTC's rule
regarding metals warehouses located in the United States,
whether it has a direct oversight role over the London Metals
Exchange, and whether certain actions in the control of physical
supplies might violate the U.S. Commodities Exchange Act.
"If you have doubts about the authority of the agency to
ensure markets are safe for trading and free from fraud or
manipulation, this Committee needs to know," Stabenow said.