WASHINGTON (Reuters) - U.S. lawmaker Barney Frank, a chief architect of financial reform, issued a warning on Thursday to those crafting new rules to straighten up the banks and financial markets: don't be looking to cash in anytime soon.
Frank, chairman of the House Financial Services Committee, blasted out an e-mail chastising a staffer who had worked on derivatives reform and recently jumped ship to work for derivatives exchange operator IntercontinentalExchange Inc.
He said several people have criticized Peter Roberson's move. "I completely agree with that criticism," Frank said.
"When Mr. Roberson was hired, it never occurred to me that he would jump so quickly from the Committee staff to an industry that was being affected by the Committee's legislation."
Frank said when Roberson called to say he was in conversations with ICE, Frank cut off his communication with other staff members and pulled the plug on his congressional paychecks.
Roberson helped write new rules that would bring the largely unregulated derivatives market, including the credit default swaps that brought insurer American International Group Inc to near collapse, under strict oversight. ICE is a key player in the derivatives markets.
A spokeswoman for ICE declined to comment on behalf of the company and Roberson.
According to the website LegiStorm, Roberson was a well-paid member of Frank's committee, earning $124,416.70 in 2009. In 2008 he earned $115,081.32, and from March 2007 through the end of that year he earned $92,264.67.
Before working for Frank's committee, Roberson lobbied for the Bond Market Association.
Washington is typically seen as a training ground for lawyers and other professionals to cut their teeth and then cash in on their experience with private sector firms.
Arguably, the massive rewrite of rules for financial firms, products and markets provides a fertile opportunity for Congressional staffers to help shape the reform and then get paid to help firms comply.
There are regulations in place to protect against conflicts of interest, including a one-year ban on communication with Congressional staffers when a staff member moves into a relevant private sector job.
Frank, however, said the ban is not adequate in Roberson's situation.
He said he has instructed the staff on his committee to have no contact whatsoever with Roberson on any matters related to financial reform for as long as he is in charge.
"I wanted to make clear I share the unhappiness of people at this, and my intention to prohibit any contact between him and members of the staff for as long as I have any control over the matter," Frank said.
(Reporting by Karey Wutkowski with additional reporting by Ann Saphir in New York, editing by Gerald E. McCormick)
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