Infiltrated: How to Stop the Insiders and Activists Who Are Exploiting the Financial Crisis to Control Our Lives and Our Fortunes

CHAPTER 8

THE OFFICIAL STORY

In 1996, President Bill Clinton appointed Brooksley Born as chair of the little-known Commodity Futures Trading Commission—to oversee, among other things, the special markets for trading derivatives. Some derivatives are purchased directly from the supplier, with no intermediary. Known as “over-the-counter” derivatives,¹ these were outside her purview. Born lobbied the president and Congress unsuccessfully to give her agency oversight of these private, “off-market” transactions.

For this, Born is lionized in a 2012 PBS Frontline special, “Money, Power and Wall Street,” as the “lone regulator who warned about the risks of derivatives—and was ignored.”² Three years earlier, in October 2009, Frontline dedicated an entire ...