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Bank lobby loosened U.S. regulation of derivatives

A Bloomberg News investigation reveals how the bank lobby prevented the U.S. from seizing authority over derivatives, financial instruments the investigation states "helped push the global economy to the brink in 2008, taking down American International Group Inc. (AIG) and Lehman Brothers Holdings Inc. and igniting the worst recession since the 1930s."

The Commodity Futures Trading Commission has produced about 60 rules for derivatives, and Bloomberg News details how the banking industry and allies forced the retreat on three of the most consequential ones for Wall Street with "one of the largest sustained lobbying attacks on a single Washington agency."

Relying on court documents and congressional records, emails and interviews, the investigation details more than 150 lobbying visits and calls to the agency between 2010 and 2013, and shows how the CFTC created winners and losers, including allowing firms such as  Koch Industries Inc. and ConocoPhillips to "trade billions of dollars in swaps and avoid the most stringent rules."

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