House committee hearing on new lock-up rules sure was interesting

I listened to the whole thing and a number of things struck me:

1. Boy, has Carl Fillichio changed his tune since his April 16th conference call with reporters, when he stonewalled and refused to answer reasonable questions. (The transcript to that call is here, but to fully appreciate the extent of his obnoxiousness, listen to the audio.)
2. Keith Hall, former BLS Commissioner and now a Senior Research Fellow at the Mercatus Center of George Mason University, is one straight shooter. He told the hearings that the Department of  Labor changes were “an effort to get traders out of the lock-ups.” What he didn’t explain, however, is why steps weren’t taken earlier to boot traders out of the lock-ups given that they’ve been there for years, and why the DOL won’t acknowledge this situation. (The only thing I can think of is that someone with influence wants the traders there. Hall said USDA likes traders in the lock-ups.)
3. Some of the Dems on the committee seemed like they would be happy to just get rid of lock-ups, which they appear to think are designed for Wall Street fat cats. Hall, on the other hand, says he still sees value in lock-ups, but that given all the technological changes, they don’t have to take place under the same rules as in the past.
4. Committee chairman Issa seemed to get nervous when Democrat Tierney  suggested that Bloomberg and Reuters are out to serve their clients and not the public.

Here’s some relevant background that bears repeating:

1. It was Carl Fillichio who granted RTTNews access to the lock-ups last year, according to a DOL spokesperson. He did this when it was widely known that trading firms were starting front news agencies to gain admission to lock-ups. RTTNews had all the warning signs including key personnel tied to the Montreal-based prop trading firm, Vigilant Global (formerly Vigilant Futures), which had earlier funded CEP News. RTTNews — along with Bond Buyer and Need to Know News (NTKN) — were not accredited to participate in the revamped lock-ups, but that doesn’t answer the question of why Fillichio let RTTNews in in the first place.
2. John Harada, the former head of NTKN, has boasted to financial industry insiders that his former news agency, a front for JED Capital, was guaranteed access to lock-ups thanks to his ties to Democratic Illinois senators. This information was given to me by sources who were astounded to hear Harada make such a claim.
3. Fake news agencies fronting for hedge funds/prop traders continue to access lock-ups around the world.