[Senate Hearing 117-601]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 117-601

                  NOMINATIONS OF THE HONORABLE CHRISTY
                    GOLDSMITH ROMERO, MS. KRISTIN N.
                  JOHNSON, MRS. SUMMER KRISTINE MERSINGER, 
                         AND MS. CAROLINE D. PHAM

=======================================================================

                                HEARING

                               BEFORE THE

                       COMMITTEE ON AGRICULTURE,
                        NUTRITION, AND FORESTRY

                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             March 2, 2022

                               __________

                       Printed for the use of the
           Committee on Agriculture, Nutrition, and Forestry
           
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]           


                  Available on http://www.govinfo.gov/
                  
                              __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
50-069 PDF                 WASHINGTON : 2023                    
          
-----------------------------------------------------------------------------------     
                 
           COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY


                 DEBBIE STABENOW, Michigan, Chairwoman
PATRICK J. LEAHY, Vermont            JOHN BOOZMAN, Arkansas
SHERROD BROWN, Ohio                  MITCH McCONNELL, Kentucky
AMY KLOBUCHAR, Minnesota             JOHN HOEVEN, North Dakota
MICHAEL F. BENNET, Colorado          JONI ERNST, Iowa
KIRSTEN E. GILLIBRAND, New York      CINDY HYDE-SMITH, Mississippi
TINA SMITH, Minnesota                ROGER MARSHALL, Kansas
RICHARD J. DURBIN, Illinois          TOMMY TUBERVILLE, Alabama
CORY BOOKER, New Jersey              CHARLES GRASSLEY, Iowa
BEN RAY LUJAN, New Mexico            JOHN THUNE, South Dakota
RAPHAEL WARNOCK, Georgia             DEB FISCHER, Nebraska
                                     MIKE BRAUN, Indiana

               Joseph A. Shultz, Majority Staff Director
               Mary Beth Schultz, Majority Chief Counsel
                    Jessica L. Williams, Chief Clerk
               Fitzhugh Elder IV, Minority Staff Director
                           
                           
                           C O N T E N T S

                              ----------                              

                        Wednesday, March 2, 2022

                                                                   Page

Hearing:

Nominations of the Honorable Christy Goldsmith Romero, Ms. 
  Kristin N. Johnson, Mrs. Summer Kristine Mersinger, and Ms. 
  Caroline D. Pham...............................................     1

                              ----------                              

                    STATEMENTS PRESENTED BY SENATORS

Stabenow, Hon. Debbie, U.S. Senator from the State of Michigan...     1
Boozman, Hon. John, U.S. Senator from the State of Arkansas......     2

                               WITNESSES

Goldsmith Romero, Hon. Christy, of Virginia, Nominated to be a 
  Commissioner of the Commodity Futures Trading Commission.......     6
Johnson, Kristin N., of Michigan, Nominated to be a Commissioner 
  of the Commodity Futures Trading Commission....................     7
Mersinger, Summer Kristine, of South Dakota, Nominated to be a 
  Commissioner of the Commodity Futures Trading Commission.......     9
Pham, Caroline D., of New York, Nominated to be a Commissioner of 
  the Commodity Futures Trading Commission.......................    11
                              ----------                              

                                APPENDIX

Prepared Statements:
    Goldsmith Romero, Hon. Christy...............................    26
    Johnson, Kristin N...........................................    28
    Mersinger, Summer Kristine...................................    31
    Pham, Caroline D.............................................    34

Document(s) Submitted for the Record:
Stabenow, Hon. Debbie:
    U.S. Cattlemen's Association, letter of support..............    38
    Undersigned organizations, letters of support................    39
Warnock, Hon. Raphael:
    Senator Jon Ossoff, letter of support........................    41
Goldsmith Romero, Hon. Christy:
    Committee questionnaire, Office of Government Ethics 
      Executive Branch Personnel Public Financial Disclosure 
      Report and 5-day letter filed by Goldsmith Romero, Hon. 
      Christy.................................................... 42-67
Johnson, Kristin N.:
    Committee questionnaire, Office of Government Ethics 
      Executive Branch Personnel Public Financial Disclosure 
      Report and 5-day letter filed by Johnson, Kristin N........ 68-97
Mersinger, Summer Kristine:
    Committee questionnaire, Office of Government Ethics 
      Executive Branch Personnel Public Financial Disclosure 
      Report and 5-day letter filed by Mersinger, Summer Kristine 
        


Pham, Caroline D.:
    Committee questionnaire, Office of Government Ethics 
      Executive Branch Personnel Public Financial Disclosure 
      Report and 5-day letter filed by Pham, Caroline D.   



Question and Answer:
Goldsmith Romero, Hon. Christy:
    Written response to questions from Hon. Debbie Stabenow......   162
    Written response to questions from Hon. John Boozman.........   163
    Written response to questions from Hon. Sherrod Brown........   164
    Written response to questions from Hon. Amy Klobuchar........   164
    Written response to questions from Hon. Raphael Warnock......   164
    Written response to questions from Hon. John Hoeven..........   165
    Written response to questions from Hon. Roger Marshall.......   165
    Written response to questions from Hon. Tommy Tuberville.....   166
    Written response to questions from Hon. Charles Grassley.....   167
Johnson, Kristin N.:
    Written response to questions from Hon. Debbie Stabenow......   169
    Written response to questions from Hon. John Boozman.........   170
    Written response to questions from Hon. Sherrod Brown........   171
    Written response to questions from Hon. Amy Klobuchar........   171
    Written response to questions from Hon. Raphael Warnock......   171
    Written response to questions from Hon. John Hoeven..........   172
    Written response to questions from Hon. Roger Marshall.......   173
    Written response to questions from Hon. Tommy Tuberville.....   173
    Written response to questions from Hon. Charles Grassley.....   175
Mersinger, Summer Kristine:
    Written response to questions from Hon. Debbie Stabenow......   176
    Written response to questions from Hon. John Boozman.........   177
    Written response to questions from Hon. Sherrod Brown........   178
    Written response to questions from Hon. Amy Klobuchar........   178
    Written response to questions from Hon. Raphael Warnock......   178
    Written response to questions from Hon. John Hoeven..........   179
    Written response to questions from Hon. Roger Marshall.......   179
    Written response to questions from Hon. Tommy Tuberville.....   180
    Written response to questions from Hon. Charles Grassley.....   181
Pham, Caroline D.:
    Written response to questions from Hon. Debbie Stabenow......   183
    Written response to questions from Hon. John Boozman.........   184
    Written response to questions from Hon. Sherrod Brown........   185
    Written response to questions from Hon. Amy Klobuchar........   185
    Written response to questions from Hon. Raphael Warnock......   185
    Written response to questions from Hon. John Hoeven..........   186
    Written response to questions from Hon. Roger Marshall.......   186
    Written response to questions from Hon. Tommy Tuberville.....   187
    Written response to questions from Hon. Charles Grassley.....   188

 
                      NOMINATIONS OF THE HONORABLE


 
CHRISTY GOLDSMITH ROMERO, MS. KRISTIN N. JOHNSON, MRS. SUMMER KRISTINE 
                  MERSINGER, AND MS. CAROLINE D. PHAM

                              ----------                              


                        WEDNESDAY, MARCH 2, 2022

                                       U.S. Senate,
         Committee on Agriculture, Nutrition, and Forestry,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10 a.m., via 
Webex and in room 216, Hart Senate Office Building, Hon. Debbie 
Stabenow, Chairwoman of the Committee, presiding.
    Present or submitting a statement: Senators Stabenow, 
Brown, Bennet, Gillibrand, Booker, Warnock, Boozman, Hoeven, 
Ernst, Marshall, Tuberville, Grassley, Thune, Fischer, and 
Braun.

STATEMENT OF HON. DEBBIE STABENOW, U.S. SENATOR FROM THE STATE 
    OF MICHIGAN, CHAIRWOMAN, U.S. COMMITTEE ON AGRICULTURE, 
                    NUTRITION, AND FORESTRY

    Chairwoman Stabenow. It is my pleasure to call today's 
hearing to order on the nomination of the Honorable Christy 
Goldsmith Romero, Kristin Johnson, Summer Mersinger, and 
Caroline Pham to serve as Commissioners of the Commodity 
Futures Trading Commission (CFTC). Welcome to the nominees, and 
I have to say, to begin, I cannot think of a better way to 
start Women's History Month by celebrating these strong, 
confident women.
    It is a pleasure to have all of you here today and to have 
your families with you.
    The CFTC has gone far too long without its full complement 
of commissioners. Today's hearing, for two Democrats and two 
Republicans, is an important step toward getting this financial 
watchdog back to its full capacity. It is critical that we 
confirm these nominees without delay.
    The invasion of Ukraine has led to price volatility in 
wheat and other agricultural markets, and there are reports 
that U.S. efforts to limit Russia's access to capital may be 
undermined by the use of unregulated crypto markets. A fully 
operational Commission will help to ensure that our 
agricultural producers have the tools they need to manage these 
and other price risks. We look forward to working with the 
Commission to bring appropriate oversight for the trading of 
digital assets.
    These nominees are extremely qualified, and each would 
bring a unique perspective to their work at the Commission, 
making them well suited to address these new challenges. 
Inspector General Goldsmith Romero has investigated financial 
fraud, most recently as the Special Inspector General for the 
Troubled Asset Relief Program, a position to which the Senate 
confirmed her by voice vote.
    Ms. Johnson is a professor and internationally recognized 
expert in financial markets, including on fintech and risk 
management. Ms. Mersinger worked in leadership roles at the 
Commission and here in the Senate. Ms. Pham began her career at 
the Commission and has significant experience implementing 
financial market reforms in the private sector.
    They are also, as I said, making history. The Committee is 
reviewing the nomination of four women from both sides of the 
aisle, two of them women of color, to our country's preeminent 
financial regulator. I should say one of them, I guess Banking 
might argue with that, but I think it is the premier.
    Our financial markets must work for everybody, so it is 
critical that our leaders bring different backgrounds and 
experience to the important job of protecting our markets and 
those who use them.
    As we saw at our hearing on digital assets there is broad 
bipartisan interest and industry support for greater oversight 
of the digital asset marketplace. Making the financial system 
more accessible to the average American must go hand in hand 
with appropriate consumer protections.
    As we think about Federal regulation for digital assets and 
we think about what they should look like, we are going to lean 
on the leadership and experience of the Commission, and I trust 
that the CFTC can rise to the challenge. We must give the CFTC 
additional resources if we are to give it more authority over 
our digital assets. We cannot repeat the mistakes of Dodd-Frank 
and give the CFTC more responsibility without an appropriate 
increase in funding.
    We also need to make sure our financial markets can respond 
to the escalating risks posed by the climate crisis. The 
derivatives markets will play an important role in the 
transition to a carbon-neutral economy, whether to protect 
against extreme weather events or help farmers generate income 
from implementing climate-smart agricultural practices.
    All four nominees have support from a broad range of 
stakeholders across the financial and agricultural sectors, and 
I would ask unanimous consent that a letter indicating that, 
describing this support, be entered into the record. Without 
objection, so ordered.

    [The letters can be found on pages 38-41 in the appendix.]

    Chairwoman Stabenow. With that I will now turn to my friend 
and our Ranking Member, Senator Boozman, for his opening 
comments.

 STATEMENT OF HON. SENATOR JOHN BOOZMAN, U.S. SENATOR FROM THE 
                       STATE OF ARKANSAS

    Senator Boozman. Well thank you, Madam Chair, and I am 
pleased to join you today in welcoming each of our nominees to 
the Committee as we consider their nominations to be 
Commissioners of the Commodity Futures Trading Commission. I 
congratulate all of you on your nomination and your willingness 
to serve our country. The four of you bring diverse experiences 
and a broad range of knowledge that will add value to the 
Commission.
    It is certainly worth repeating that today's hearing is 
historic in that not only are we considering four highly 
qualified nominees but four highly qualified female nominees, 
which is something we should all be very proud of. I commend 
and congratulate all of you on this achievement.
    If confirmed, each of our nominees will set the tone and 
direction of a vital agency that regulates a wide range of 
financial products that are essential tools used by end users 
like farmers, ranchers, municipalities, and pension funds to 
hedge commercial risk. Beyond legacy commodity contracts that 
market participants have used for centuries to manage risk, 
these markets have also grown to include derivative contracts 
on interest rates, stock indexes, foreign currency, and even 
digital assets like Bitcoin futures. The CFTC also has the 
authority to bring enforcement actions in cases of fraud and 
manipulation in commodity cash markets.
    While digital assets and distributed ledger technology are 
revolutionizing financial transactions and the way people 
manage their money, questions remain as to the proper role 
Federal regulators should play in encouraging further 
innovation in digital assets while ensuring market participants 
are protected. Our nominees will play a pivotal role as 
Congress, with input from stakeholders, consumers, and 
industry, navigate a path forward.
    To each nominee, I look forward to hearing your goals and 
your visions for what you hope to accomplish at CFTC should you 
be confirmed, particularly as it pertains to engaging with 
other financial regulators and providing guidance to Congress 
regarding what, if any, expanded role regulators should have 
over digital asset commodity spot markets as we debate the 
guardrails that could be implemented.
    Like any agency, I believe the CFTC functions best when it 
is fully operational and with a full slate of commissioners. I 
am glad we can hold this hearing today, and I look forward to 
getting you all in place soon so that we can ensure that the 
markets you regulate continue to operate effectively, and in a 
fair and transparent manner.
    With that I yield back.
    Chairwoman Stabenow. Well thank you very much, and let me 
now officially introduce each of our four nominees. First, 
Christy Goldsmith Romero is the Special Inspector General for 
the Troubled Asset Relief Program, where she leads an 
independent office conducting investigations and audits of 
Federal programs. She has served in this role since her Senate 
confirmation in 2012.
    Inspector General Goldsmith Romero previously worked at the 
Securities and Exchange Commission, where she investigated 
securities violations in the Division of Enforcement and served 
as counsel to two SEC chairs. She is an adjunct professor at 
the Georgetown Law Center and University of Virginia School of 
Law, where she teaches courses on securities regulation, 
cryptocurrency regulation, and Federal oversight.
    Inspector General Goldsmith Romero received her 
undergraduate degree from Old Dominion University and her law 
degree from Brigham Young University.
    Now I am going to turn to Senator Warnock to introduce our 
next nominee.
    Senator Warnock. Well thank you so very much, Chair 
Stabenow. It is my pleasure to welcome a Georgian to the 
Agriculture Committee today as a nominee to the Commodity 
Futures Trading Commission. I should say that we have many 
great colleges and universities in Georgia. In fact, I heard 
that Senator Coach Tuberville will be here so I brought my 
University of Georgia mug just for him.
    Kristin Johnson is a professor at one of our other great 
universities, Emory University School of Law in Atlanta, 
Georgia. She has over a decade of experience teaching corporate 
securities and banking law. In addition to her academic work, 
Ms. Johnson has worked in the private sector. She has a 
practical view of banking and securities law to complement her 
academic expertise.
    She brings both a theoretical framework grounded in 
practical understanding. If confirmed, she will be useful at 
the CFTC and to the Nation. We are very proud of her. She is a 
proud Georgian.
    Chair Stabenow, you will be happy to know that my 
constituent also has Michigan ties.
    Chairwoman Stabenow. I noticed that.
    Senator Warnock. She is a proud graduate of the University 
of Michigan Law School. Ms. Johnson, congratulations on your 
nomination, your hard work across the years, and thank you for 
being here today. Welcome.
    Chairwoman Stabenow. Thank you so much. Now Senator Thune 
will make an introduction.
    Senator Thune. Thank you, Chair Stabenow and Ranking Member 
Boozman, for holding this hearing. Thanks to all the nominees 
for your willingness to serve. As Chair, you and Senator 
Boozman have pointed out in your opening statements, this is a 
critically important agency with a wide swath of jurisdiction 
in areas that are critically important to our economy, and 
obviously coming from an agricultural State we all recognize 
the role that the CFTC plays in helping our farmers and 
ranchers manage risk and having oversight over so many of the 
issues that they deal with on a daily basis. Thank you all for 
your willingness to serve.
    It is my privilege today to introduce Summer Mersinger, who 
has been nominated to serve as a Commissioner at the CFTC. I 
have had the privilege of knowing Summer for more than 20 
years. She grew up in Onida, South Dakota, where her family 
continues to run a diversified row crop operation. She went on 
to study political science at the University of Minnesota, and 
after she graduated I got to know her when she moved to 
Washington, DC, to work on my staff back in the U.S. House of 
Representatives.
    After stints on my campaign and in the private sector, 
Summer then came with me to the Senate to serve as a member of 
my staff, and while serving on my staff in the Senate and 
starting a family she pursued a law degree, attending evening 
classes at Catholic University's Columbia School of Law where 
she received her law degree in 2007. She became my Deputy Chief 
of Staff, General Counsel, before joining the Smith-Free Group, 
where she worked on a range of issues in the private sector, 
from cybersecurity to tax policy.
    While serving on my staff, working full-time, raising kids, 
and going to law school in the evening I think is great 
evidence of the powerful work ethic that she brings to this 
job.
    In 2019, she joined then CFTC Chairman Tarbert's staff as 
Director of Legislative and Intergovernmental Affairs and then 
went on to become Commissioner Stump's Chief of Staff, a role 
which she holds today.
    All that you can read in her bio, and given her educational 
background and experience it is clear that she is prepared for 
this role today. I think it is important for members of the 
Committee to know, as we consider her nomination, that she 
approaches issues with an open mind. She is a critical thinker. 
She is a problem solver. She is fair. She is honest. She is a 
woman of integrity. The CFTC, and our U.S. Government, could be 
so lucky as to have someone of her not only caliber but 
character to serve in the government, and we are lucky that 
people like her answer that call.
    I know her husband, Pat, who is here today, and her four 
children, Sienna, Sydney, Wyatt, and Drake, are all incredibly 
proud of her, as I am, and I think all South Dakotans are as 
well.
    Summer, congratulations on your nomination, and Madam 
Chair, I look forward to considering all these nominations and 
to soon having a full Commission in place at the CFTC. Thank 
you.
    Chairwoman Stabenow. Thank you so much, Senator Thune, and 
I could not agree more, so thank you very much.
    Our final nominee is Caroline Pham, Managing Director at 
Citi where she has held various senior roles, including as a 
Global Head of Compliance, Deputy Head of Global Regulatory 
Affairs, and Head of Market Structure for Strategic Initiatives 
in Citi's Institutional Clients Group. She has also represented 
Citi on the Executive Committee of the Chamber of Digital 
Commerce.
    Ms. Pham was a visiting fellow at the George Washington 
University Center for Law, Economics, and Finance. Prior to 
joining Citi, Ms. Pham served as Special Counsel and Policy 
Advisor to former CFTC Commissioner Scott O'Malia. She received 
her undergraduate degree from UCLA and her law degree from 
George Washington University.
    Thanks to each of you for joining us here today. I look 
forward to discussing more your visions for the Commission.
    If you would each rise we have two official questions that 
we need to ask you.
    First, Inspector General Goldsmith Romero, Ms. Johnson, Ms. 
Mersinger, and Ms. Pham, two questions. First of all, do you 
swear or affirm that the testimony you are about to provide is 
the truth, the whole truth, and nothing but the truth, so help 
you God?
    Ms. Goldsmith Romero. I do.
    Ms. Johnson. I do.
    Ms. Mersinger. I do.
    Ms. Pham. I do.
    Chairwoman Stabenow. Thank you. Second, do you agree that, 
if confirmed, you will appear before any duly constituted 
committee of Congress if asked to appear?
    Ms. Goldsmith Romero. I do.
    Ms. Johnson. I do.
    Ms. Mersinger. I do.
    Ms. Pham. I do.
    Chairwoman Stabenow. All right. Thank you very much. Thank 
you all.
    Your testimony will be made part of the record in its 
entirety, and we will now begin with our five-minute opening 
statements from each of you. We will start with Inspector 
General Goldsmith Romero.

    STATEMENT OF THE HONORABLE CHRISTY GOLDSMITH ROMERO, OF 
   VIRGINIA, NOMINATED TO BE A COMMISSIONER OF THE COMMODITY 
                   FUTURES TRADING COMMISSION

    Ms. Goldsmith Romero. Chairwoman Stabenow, Ranking Member 
Boozman, members of the Committee, it is my honor to appear 
before you today, and I am deeply grateful to President Biden 
for nominating me to be a Commissioner at the Commodity Futures 
Trading Commission.
    I am pleased to recognize my wife, Adrianne, my three 
daughters Chelsea, Brooke, and Julia, and my son-in-law Seth. 
We are a close-knit family, and they are my foundation and my 
joy. I also want to recognize my parents, and my in-laws, and 
my siblings, who have all been very supportive of me.
    I also have to recognize and thank everyone, past and 
present, at my current office, SIGTARP. They are public 
servants that are dedicated to making a difference.
    I come from a military family who raised me to have a sense 
of duty and service to others. My father joined the U.S. Navy 
as a young man in the Philippines. He became a U.S. citizen and 
served our country for 20 years. My brother, Scott, has served 
in the U.S. Army Reserves for 34 years, and they have inspired 
me in my 20 years of Federal service.
    The CFTC's mission is to promote the integrity, resilience, 
and vibrancy of U.S. derivatives markets through sound 
regulation. This mission contributes to U.S. markets being the 
strongest and safest in the world. Whether focused on hard 
commodities like agriculture, energy, or metals, or on the 
financial sector, the Commission plays a critical role in 
ensuring that these markets work well. That starts with 
agriculture--the farmers, ranchers, and producers that our 
Nation depends on to put food on our tables and help drive our 
economy. They need U.S. derivatives markets to work for risk 
management and price discovery, and this requires the CFTC to 
fulfill its mission, which is a mission that I take to heart.
    I have spent my career helping protect our markets. At the 
Securities and Exchange Commission, I worked to promote market 
integrity and protect investors in the Enforcement Division. As 
counsel to SEC Chairmen Cox and Schapiro, I helped them oversee 
markets during a national crisis.
    Through three administrations, I have served as the Special 
Inspector General for the Troubled Asset Relief Program at 
Treasury, helping our economy recover after the financial 
crisis. With 465 criminal prosecutions, 25 civil enforcement 
actions, 11.3 billion dollars recovered, and hundreds of 
recommendations to improve government, SIGTARP helps safeguard 
our markets and financial system, and it will forever have been 
my privilege to have served as its leader. I am also an adjunct 
law professor at the University of Virginia and Georgetown, 
where I teach on securities and cryptocurrencies.
    If confirmed, my highest priority would be to ensure that 
these markets are working well, that they are open, fair, and 
competitive. I would prioritize identifying and mitigating 
risks to these markets, and I would promote a culture of 
compliance coupled with strong enforcement. I will work to 
protect markets and customers against fraud and manipulation, 
just as I have done throughout my career.
    As our markets evolve with digital assets and climate, 
regulators must be thoughtful and deliberate. It is important 
to learn the facts, listen to all sides, understand the 
consequences of any action, and collaborate with other 
regulators.
    My parents instilled in me the values of listening and 
respecting others. I will make it a priority to engage with end 
users, and I am committed to working with you.
    Serving my country is my way of giving back to a country 
that has given my family so many opportunities. I have a broad 
and deep experience in protecting our markets, and it would be 
my honor and privilege to use that experience as a CFTC 
Commissioner. I commit to do all that I can to promote the 
integrity, resilience, and vibrancy of our markets so that they 
continue to be the strongest and safest in the world.
    Thank you for this honor.

    [The prepared statement of Ms. Goldsmith Romero can be 
found on page 26 in the appendix.]

    Chairwoman Stabenow. Thank you very much. We will now hear 
from Ms. Johnson.

STATEMENT OF KRISTIN N. JOHNSON, OF MICHIGAN, NOMINATED TO BE A 
    COMMISSIONER OF THE COMMODITY FUTURES TRADING COMMISSION

    Ms. Johnson. Thank you, Chairwoman Stabenow, Ranking Member 
Boozman, and other distinguished members of this Committee for 
holding this hearing. I want to thank President Biden for 
nominating me to serve as a CFTC Commissioner at this critical 
time for global markets and our Nation. I also want to thank 
Senator Warnock for his very generous introduction. Finally, I 
would like to thank the Committee members and their staffs for 
their assistance during this nomination process.
    My family arrived in the Midwest in the early 1800's and 
settled in a small town on the Wabash River. The started small 
businesses and served as civil servants, legal advocates, 
teachers, and nurses. They volunteered to serve our Nation in 
times of war and peace. My sisters and I inherited this 
commitment to public service. We were raised in faith, and 
embraced values like hard work, honesty, and integrity, and we 
enjoyed the sense of infinite possibilities that America 
provides.
    I developed an interest in finance as a student at 
Georgetown University. After graduating, I worked as an analyst 
at an investment bank, supporting investment portfolios for 
universities and charitable endowments, public and corporate 
pension plans, hospitals and other large institutions. I went 
on to University of Michigan Law School, and there served as an 
editor on the Michigan Law Review, I clerked for a Federal 
court judge, and I practiced law in the New York and London 
offices of a large law firm. Later, I served as Vice President 
and Assistant General Counsel at one of the largest financial 
institutions in the country.
    Today I serve as the Asa Griggs Candler professor at Emory 
University Law School. For many years my work has focused on 
risk management oversight, understanding financial crises and 
protecting the economy from these disruptive events. My current 
work examines emerging technologies such as artificial 
intelligence and blockchain technologies that facilitate the 
creation of cryptocurrency trading platforms.
    Our futures and derivatives markets are globally 
preeminent. In the domestic economy, markets impact the lives 
of many Americans, influencing the cost of energy resources 
used to heat homes, fuel transport, cultivate crops, and 
manufacture goods. It is critical that these markets work 
effectively.
    After the financial crisis of 2008, Congress adopted the 
Dodd-Frank Act, expanding the CFTC's authority to implement 
reforms that increase transparency and liquidity and mitigate 
risks in previously unregulated swaps markets. While these are 
important accomplishments, much work remains.
    Markets increasingly face new challenges, including a 
global health crisis, concerning geopolitical events, and cyber 
threats. During crises, the CFTC's role in protecting market 
integrity is even more critical, because many, including 
farmers, ranchers, grain elevator operators, producers, and 
distributors rely on derivatives markets to determine prices 
and manage risk. If confirmed, I will support the CFTC in its 
mission to ensure orderly trading and liquidity as well as 
customer protection, fairness, and transparency in futures and 
derivatives markets.
    New technologies expand the financial market ecosystem, 
promising to increase access to markets, enhance transparency 
and efficiency, and reduce the time and cost needed to execute 
transactions. These developments include platforms that operate 
without centralized intermediaries, smart contracts, blockchain 
technology, quantum and cloud computing, and automated trading, 
among others. With a few quick taps, for example, retail 
investors may quickly and easily download smartphone apps that 
execute complex, leveraged, digital asset transactions.
    Yet new products and platforms face growing concerns--data 
breaches, Oceans 11 and Bonnie and Clyde style heists, and 
cyberattacks that threaten to disrupt markets. In addition, in 
these markets there may be low or no visibility, and 
uncertainty regarding customer protections.
    Public service is the highest calling. To that end, I will 
maintain an open door. I look forward to visiting with market 
participants to better understand their concerns. If confirmed, 
I will offer my experience and expertise in service of ensuring 
the CFTC's continued leadership in fostering responsible 
innovation and open, fair, and competitive and financially 
sound markets.
    Before closing I wish to acknowledge the love and support 
of my family and friends, and in particular my son, Jackson, 
for his patience as I endeavor to be in service to others. I 
also want to thank my parents. Their hard work and sacrifices 
paved the way for me to be here today.
    Thank you again for the honor to appear before you. I look 
forward to your questions.

    [The prepared statement of Ms. Johnson can be found on page 
28 in the appendix.]

    Chairwoman Stabenow. Thank you so very much. Ms. Mersinger.

   STATEMENT OF SUMMER KRISTINE MERSINGER, OF SOUTH DAKOTA, 
NOMINATED TO BE A COMMISSIONER OF THE COMMODITY FUTURES TRADING 
                           COMMISSION

    Ms. Mersinger. Chairwoman Stabenow, Ranking Member Boozman, 
and distinguished members of this Committee, it is a true honor 
to be here today and I am humbled by this opportunity to share 
with you my background and experience as you consider my 
nomination as a Commissioner at the Commodity Futures Trading 
Commission. I want to say a special thank you to Senator Thune 
for that wonderful intro. The work ethic and the integrity and 
the desire to serve that you described I believe come from my 
years of learning directly from you, so thank you.
    With the start of Women's History Month, I cannot think of 
a better way to celebrate the legacy of the many women who made 
important contributions to this great nation than sitting here 
at this table with these three impressive ladies. Christy, 
Kristin, and Caroline, I have enjoyed every minute of this 
journey with you. I already consider you friends and if we are 
confirmed I know you will be exceptional colleagues.
    I am also honored and grateful to have my family and 
friends supporting me through this process. My husband, 
Patrick, is here with me today. While some may say it takes a 
village to raise children, I say it takes a Patrick. I am so 
grateful for his love, his patience, and his endless support. 
My four children are also here with me today. Sienna, Sydney, 
Wyatt and Drake, I have two important messages for you: First, 
I love you more than you will ever know, and second, I am sorry 
for making you dress up today. I promise when you get home you 
can change. To my family and friends watching from afar, thank 
you for everything. I am incredibly blessed and my heart is 
full.
    I would like to take this opportunity to share with you my 
background and experience which make me uniquely qualified to 
serve as a Commissioner at the Commodity Futures Trading 
Commission. I grew up in central South Dakota, where my dad 
still farms the land, growing wheat, sunflowers, corn, and 
soybeans. My parents started out working on a cattle ranch, 
working to save enough money to build their own farm operation. 
I was not exactly raised in a barn, but it was only a few yards 
away from our house.
    Agriculture is a part of my heritage and in my DNA. In the 
late 1800's, my Eastern European ancestors homesteaded in the 
county where I grew up. I can only imagine what my ancestors 
must have felt looking out on the vast Dakota prairies, 
venturing into a new frontier in search of the American Dream. 
I am certain they were overwhelmed, but I also like to think 
they were excited by the opportunity to create a legacy for 
future generations.
    My background on the farm is only a small part of my story. 
After college, I spent over 15 years working on Capitol Hill 
for a distinguished member of this Committee. My time on the 
Hill included a crash course in financial markets and 
regulations while managing these issues for the Senator during 
the financial crisis of 2008.
    Over the last years, I have had the good fortune of working 
at the CFTC for two amazing members of the Commission. In my 
role as the Director of the Office of Legislative and 
Intergovernmental Affairs under former Chairman Heath Tarbert, 
I was immersed in the Commodity Exchange Act, working in a 
bipartisan manner with House and Senate Agriculture Committees 
and staff to find common ground to reauthorize the agency. I 
also spent time coordinating with our appropriators to 
communicate the needs of the agency and work in a bipartisan, 
bicameral effort to secure the agency's annual budget requests.
    Most recently, I have had the honor of working for 
Commissioner Dawn Stump. In this role, I have engaged in 
detailed discussions with our enforcement team, had in-depth 
briefings from our policy divisions, discussed important work 
force matters, and worked in a collaborative manner with 
Commission staff to reach compromises and agreements.
    I also had the incredible opportunity of serving as the 
Designated Federal Officer for the Agricultural Advisory 
Committee. This advisory committee was critical at the height 
of the pandemic when unique supply chain issues disrupted many 
of our agricultural markets. The AAC was a way to communicate 
with numerous stakeholders to hear real-time perspectives and 
to share with those stakeholders the actions we were taking at 
the CFTC to ensure markets continued to function in their role 
as reliable price discovery and risk management tools.
    Sitting here today, with this group of amazing women, I 
like to think I am experiencing at least some small part of 
what my ancestors felt so long ago. I believe the CFTC is 
starting a journey into a new frontier, and I am excited by the 
opportunity to navigate this new territory should I be 
confirmed.
    This new frontier will be fertile ground for new innovation 
that will benefit our financial system and our economy as a 
whole, but reaping those benefits also will require managing 
risks and hazards as we plow new ground. Should I be confirmed, 
I am ready to use my background and experience to do my part in 
creating a legacy at the CFTC of fostering responsible 
innovation, while assuring integrity and resilience in our 
markets.
    Thank you for this opportunity and I look forward to your 
questions.

    [The prepared statement of Ms. Mersinger can be found on 
page 31 in the appendix.]

    Chairwoman Stabenow. Thank you very much. Last but 
certainly not least, Ms. Pham.

 STATEMENT OF CAROLINE D. PHAM, OF NEW YORK, NOMINATED TO BE A 
    COMMISSIONER OF THE COMMODITY FUTURES TRADING COMMISSION

    Ms. Pham. Chairwoman Stabenow, Ranking Member Boozman, and 
distinguished members of the Committee, it is an honor to 
appear before you today. I am humbled and grateful.
    My family has made me who I am today. I want to thank my 
father, who taught me civic duty and started my journey here 
with my high school internship in the mayor's office. I want to 
thank my mother, who sacrificed her career for her children and 
told me to never let anyone hold me back. In America, I can do 
anything if I work hard enough, even grow up to be somebody 
like my grandfather, who was a Governor and a judge. I want to 
thank my brothers, who always helped me get back up again when 
life knocks you down, and most of all I want to thank my family 
in the room, especially my daughter, Eleanor. I am a proud mama 
and hi to the fifth-grade class of Pine Street School.
    I would also like to thank my teachers, mentors, sponsors, 
and friends who saw potential in me and the impact I could 
make.
    I would like to tell you my parents' story, because it 
shows why serving my country is so personal to me. They were 
saved on the last day of the Vietnam War, April 30, 1975, when 
they were airlifted by helicopter, just after midnight, from 
the roof of the U.S. Embassy by brave American diplomats and 
troops who risked their lives to help them. On that day, Saigon 
fell to the Communists. Even though my mother was pregnant, my 
parents waited to leave because my father, an Army doctor and 
chief of a military hospital ward, would not desert his 
patients and his post. Duty first.
    American troops made sure my parents were safely evacuated 
to the United States. My parents were first on a cargo ship 
with 3,000 other refugees, where they stayed on deck under the 
sun and rain for one week before being taken to the 
Philippines. Then at Wake Island for a month, my father 
volunteered with the U.S. Navy and CDC doctors, even saving a 
two-year-old's life. Then the US Air Force flew them to Camp 
Pendleton where they waited for what was next.
    Americans, from every part of the United States but 
especially ag country, showed up for them with kindness, 
generosity and open hearts. My mother's wish is for me to honor 
their memory today. My parents first went to Elgin, North 
Dakota, where Mrs. Elizabeth Beede, wife of North Dakota State 
Senator Ralph Beede, warmly hosted them, then Oakland 
University in Michigan. Next, in Needles, California, Mrs. Ann 
Advocate and the church welcomed my family. Then to New Jersey. 
Rural communities need doctors, and my family ended up in 
Modesto, California, where I was born.
    This story of my family, and the fact that I am here now, 
shows why America is the greatest democracy of all. I want to 
give back to our heroes in uniform and the kind-hearted folks 
across this great nation who gave us a new life.
    Although I live in New York City now, my roots are 
important. Modesto's top ag products include milk, almonds, 
chickens, cattle, peaches, tomatoes, and, of course, wine. When 
I was growing up we owned orchards and I did 4-H, showing 
horses at the county and State fair. Organizations like the 
American Legion and our Rotary Club, where my father was 
president, instilled in me good citizenship and strong 
character and reputation. I was raised with values like 
fairness, integrity, loyalty, service, and helping others.
    Two of my guiding principles are hard work and life-long 
learning. I was studying at GW Law during the 2008 financial 
crisis and wanted to contribute in some way. I interned at the 
U.S. Court of Federal Claims and in enforcement at the CFTC, 
SEC, and the bank regulator, the OCC. It was then my privilege 
to work at the CFTC during Dodd-Frank, with selfless public 
servants dedicated to safeguarding our markets. The CFTC raised 
me too, and it is part of my roots.
    My career and extensive experience, including hands-on 
implementation of regulatory reforms, has taken me around the 
world and shown me that it is critical that global markets are 
well-functioning and that there are clear rules of the road to 
facilitate compliance, promote market integrity, and foster 
innovation and growth. I am still amazed at the power of strong 
leadership and in coming together to find common standards and 
common solutions.
    This is another inflection point where the world faces 
immense challenges and the U.S., especially the CFTC, can build 
or reshape global financial market structure. I know firsthand 
the importance of a pragmatic approach and ensuring the 
protection of Americans and businesses that depend on our 
markets for risk management and price discovery.
    I thought that being promoted to managing director was 
going to be the highlight of my professional career. I now know 
that sitting here before you is. If confirmed, I will work hard 
to get the job done. Thank you.

    [The prepared statement of Ms. Pham can be found on page 34 
in the appendix.]

    Chairwoman Stabenow. Thank you very much. We will now go to 
a round of five-minute questions from each member, and I have a 
couple of topics I would like to ask each of you about. The 
first is actually a very simple yes or no, and then I would 
like to do a followup. Starting with Inspector General 
Goldsmith Romero, at this Committee's recent digital assets 
hearing, all the witnesses advocated for greater Federal 
oversight of the spot market for digital assets and stated the 
CFTC is well positioned to regulate the market.
    A simple question. Do you believe that today there is 
sufficient regulatory oversight of the spot digital asset 
market?
    Ms. Goldsmith Romero. No, Chairwoman.
    Chairwoman Stabenow. Thank you. Ms. Johnson?
    Ms. Johnson. No, Chairwoman.
    Ms. Mersinger. No, Chairman.
    Ms. Pham. No, Chairwoman.
    Chairwoman Stabenow. Thank you. We are starting from 
agreement. This is good. Let me ask a followup. Speak about the 
CFTC's positioning to regulate spot digital asset commodities. 
Do you think it is well positioned to do that, and could you 
speak to that a moment?
    Ms. Goldsmith Romero. Absolutely.
    Ms. Johnson. I would agree, yes.
    Chairwoman Stabenow. Great.
    Ms. Mersinger. I would agree as well.
    Ms. Pham. Yes, Chairwoman.
    Chairwoman Stabenow. Well, Senator Boozman, I think we have 
got some work to do at the Commission, right? Great. Thank you 
very much.
    Let me now move to another really critical area of 
tremendous risk in many, many ways, and that is the climate 
crisis.
    Chair Behnam has stated that climate change poses a major 
threat to the U.S. financial system, and other financial 
regulators have echoed that view. Do you agree, and if so, what 
will you do to help address this risk, if confirmed? Let me 
start again with Inspector General Goldsmith Romero.
    Ms. Goldsmith Romero. Thank you, Chairwoman, for that very, 
very important question. I do agree that there is a threat. I 
think the CFTC's role is to first understand that threat, 
understand the amount of risk, and to engage in that, and I 
would work with the Chairman with that.
    The other thing I wanted to point out is that the 
derivatives market provide an opportunity to hedge against that 
risk, particularly as we transition to a carbon-neutral 
environment. These are the things I would focus on if I am 
confirmed.
    Chairwoman Stabenow. Ms. Johnson?
    Ms. Johnson. Thank you so much, Chairwoman, for that 
question. I would echo my fellow nominee's emphasis on the 
CFTC's role in this context. The markets that the CFTC oversees 
include derivatives that directly relate to these questions, 
but also registrants and others. In this context, the 
agricultural community we can imagine as well, who regularly 
depend on derivatives to determine price and to manage and 
mitigate risk.
    There are a number of constituents that are deeply impacted 
by severe weather events. The increased number of severe 
weather events and the frequency of those events is certainly 
of concern to all of them, and yes, I support Chair Behnam and 
my fellow nominees, and would look into this, inviting 
conversation from all constituents.
    Chairwoman Stabenow. Thank you very much. Ms. Mersinger.
    Ms. Mersinger. Thank you for the question. Climate risk is 
one of the many risks that businesses need to prepare for, and 
I believe the CFTC's markets actually serve as a tool in this 
effort and certainly in managing the risk that comes from 
extreme weather and climate, but also in managing transition 
risk as we try to move to a net-zero economy. We already have 
some existing contracts trading in this area, and if confirmed, 
I look forward to working closely with Chairman Behnam as he 
addresses this issue.
    Chairwoman Stabenow. Thank you very much. Ms. Pham.
    Ms. Pham. Chairwoman, it is a hard issue that needs to be 
thoughtfully studied. This impacts so many important 
stakeholders, from market participants to end users and up and 
down the value chain. With that level of scale and complexity 
there is always the question of this risk, and I believe in the 
power of markets to provide solutions. There are opportunities 
here for innovation and new risk management products, and I 
would like to point out that the CFTC has been doing that since 
day one.
    Chairwoman Stabenow. Thank you. Finally a question for Ms. 
Johnson on cybersecurity. We know that cyberattacks are 
becoming much more commonplace, and we are certainly hearing 
about this now in the context of what is happening 
internationally, and pose clear risks to our financial markets 
and our national security.
    How do you think the CFTC can most effectively monitor for 
cyber threats and keep them from disrupting our derivatives 
markets?
    Ms. Johnson. Thank you so much, Chairwoman Stabenow, for 
that question. This is a critical issue for our time, and on 
this particular day for our Nation and around the world. The 
threat is real, and there is a certainty of need for 
preparedness, preparedness on the part of the agency and its 
ability to execute its mission and effectively oversee markets 
and ensure market integrity and stability.
    Therefore, we will continue to integrate 21st century 
technology within the agency to ensure preparedness and system 
safeguards of the agency's systems itself but also engage 
continuously in communication and conversation with registrants 
and others. In periods of extreme disruption or high 
volatility, the CFTC is boots on the ground, the cop on the 
beat, if you will, and prepared in many instances to assist 
registrants with organizing resiliency and recovery programs. 
Each has indicated already to the CFTC, in an amazing 
conversation with the agency, about day one plans for instances 
in which there are breaches or disruptions of service.
    I would like to commit to continue in that endeavor and 
support the Chair and the agency in ensuring its systems 
preparedness as well as that of those operating in our markets.
    Chairwoman Stabenow. Thank you very much. I will now turn 
to Senator Boozman.
    Senator Boozman. Thank you, Madam Chair. This is for the 
whole panel. I have heard from several ag interests that there 
is a perceived shift at the CFTC to become an agency which is 
heavy on enforcement. While I support punishing bad actors, I 
understand that enforcement continues to play a larger role at 
the CFTC, even in situations where violations are minor, 
unintentional, and could be easily corrected.
    If confirmed, could you commit to advocating that the 
Commission work with the market participants to proactively fix 
issues when violations are inadvertent and largely immaterial, 
and not automatically default to issuing fines and other 
penalties? In other words, more of a helpful attitude versus a 
gotcha attitude.
    We will start with the IG that deals with these things all 
the time.
    Ms. Goldsmith Romero. Thank you, Ranking Member Boozman. 
Yes, I would commit to that.
    Senator Boozman. Very good.
    Ms. Johnson. Thank you, Ranking Member Boozman. I would 
echo my nominee's commitment but underscore that I strongly 
believe in robust enforcement and can imagine balancing that 
with ensuring or encouraging cultures of compliance at 
registered entities subject to oversight.
    Senator Boozman. Very good.
    Ms. Mersinger. Yes, Senator Boozman, and I will always put 
agriculture first, if confirmed.
    Ms. Pham. I agree with my fellow nominees, Senator Boozman, 
and I think it is important that we provide regulatory clarity 
and guidance to our markets.
    Senator Boozman. Very good. Again, this is another question 
for the panel, and I would like for you to elaborate on it a 
little bit. I think it is important.
    It is estimated that Bitcoin and Ether, which have both 
been determined to be commodities, make up about 60 percent of 
the total aggregate value of cryptocurrency market cap. Beyond 
these two digital assets, do you believe it makes sense for 
CFTC to provide a list of guidance on which other digital 
assets it considers to be commodities?
    Let us start at the other end.
    Ms. Pham. Senator, I appreciate the bipartisan and 
thoughtful engagement and support from the Ag Committees on 
this critical issue. There have to be clear rules of the road 
to protect customers, and various markets cannot grow fairly 
and responsibly without more clarity. I would suggest that that 
is the approach that the Commission and the rest of the 
regulators in the U.S. and around the world provide on this. 
They are global markets, and it is important that the U.S. does 
not miss an opportunity to lead here and support U.S. 
businesses.
    I welcome the direction of the Congress on this, and if 
confirmed, will work with the Chairman, my fellow 
commissioners, and the staff on tackling this. I will 
faithfully uphold the CFTC's mandate and defend its 
jurisdiction, if necessary.
    Senator Boozman. Would you consider providing a list of--in 
other words, determining the other entities besides Ether and 
Bitcoin as to whether or not they are commodities versus 
something else?
    Ms. Pham. I think that providing a list can sometimes not 
keep up with the pace of innovation in new products, but I will 
point to the CFTC's method of self-certification, new 
contracts, which I do think is well suited for new products.
    Senator Boozman. Very good. Go ahead.
    Ms. Mersinger. Thank you for that question, Senator 
Boozman. As far as a list as to what is a commodity or what is 
a security, I think we need to look beyond that, and we need to 
look at the markets. When doing so, we need to figure out a way 
to appropriately balance the many opportunities that these 
assets bring with the risks as well, and certainly this is 
something where we need to continue having discussions with not 
only Federal regulators but also State regulators and industry. 
We have to get this right, and certainly if confirmed, I look 
forward to working on this at the agency.
    Ms. Johnson. Thank you so much, Ranking Member, for that 
question. I want to underscore that I am a firm believer in 
responsible innovation, and I believe your analysis regarding 
Bitcoin and Ether is as you have described. I am enthusiastic, 
if confirmed, about the opportunity to work with the Chair and 
my fellow commissioners as we set out to offer clear and 
effective guidelines.
    I am also thoughtful about the diversity of assets in this 
particular asset class, and the nuances of the attributes in 
this emerging asset class. I am mindful that we will need to 
engage in something that is commonly utilized by the CFTC, 
roundtables and conversations that bring constituents from the 
marketplace and industry, as well as others to the table to 
engage in discussions about balancing the interest in 
supporting responsible innovation with customer protections, 
transparency, and fairness in the market.
    Ms. Goldsmith Romero. Thank you, Ranking Member Boozman, 
for that. I think one of the things that Chair Behnam 
recommended was this is something maybe Congress might want to 
consider. I am concerned about providing a list and not being 
able to keep up, and I think one of the issues that could be 
helpful from a regulatory approach is providing clarity on how 
that decision is made as to what is a digital asset security 
versus a commodity.
    I do want to say, this is an area where we have got to get 
that balance right. I mean, the CFTC's mission is to both 
promote market vibrancy but also to do it in a safe way that 
promotes market integrity, and that is going to be very, very 
important as you move forward.
    Senator Boozman. Very good. Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much. Now Senator 
Brown.
    Senator Brown. Thank you, Madam Chair. What a panel and 
what a Chair of this Committee. The world is beginning to 
change.
    Chairwoman Stabenow. It is about time.
    Senator Brown. It is about time. Thanks to the four 
nominees, and Professor Johnson, especially to you. I so 
enjoyed our conversation yesterday. To hear the backgrounds and 
the stories of all of you is just so inspiring, each in her own 
way. Thank you.
    You know that CFTC plays a critical role in policing 
markets, rooting out fraud, promoting stable markets. CFTC 
makes sure the financial system works for families and the 
economy instead of becoming just an arena for risky bets and 
Wall Street. We have seen too much of that in the regulatory 
parts of our government, and this is a new day and the four of 
you represent that, so thank you.
    My first question is to Professor Johnson and Inspector 
General Goldsmith Romero on cryptocurrency. Some people--and 
there is interest through much of the regulatory structure in 
this government--the SEC, the Federal Reserve, the OCC, the 
FDIC, and there should be interest in cooperation among all of 
you. Some people will say that digital assets represent 
innovation, that we should not regulate because we want to lead 
the world, and any regulation crimps innovation. I do not think 
we have to look back far to see those words used. As, Professor 
Johnson, you and I talked yesterday, for instance, about over-
the-counter derivatives. Do not regulate them. U.S. will lose 
its competitive edge. We do not want to stop innovation. We 
know how profoundly damaging to consumers and our economy that 
was.
    Professor Johnson, what do you think the CFTC's role should 
be in protecting consumers in markets from the risks of digital 
assets, and then the same question for you, Inspector General. 
Professor Johnson.
    Ms. Johnson. Thank you so much, Senator Brown, for that 
question. I want to start where you left off, the families in 
fragile financial circumstances, with limited resources on a 
regular basis to cover the costs of housing, heating their 
homes, fuel for their cars, daycare for their kids, food in 
their refrigerators, and prescription drugs. I am thoughtful 
about that particularly vulnerable group of Americans every 
time I sit down to write about risk management oversight in 
financial markets. I am thoughtful about them because the buck 
stops there. When we make mistakes it is often they who pay the 
price.
    I would just emphasis a couple of points that you made, 
Senator Brown, if I may. The first is it is imperative, in 
light of how our regulatory architecture works in financial 
markets, that we ensure collaboration among financial market 
regulators. As you noted, the alphabet soup of financial market 
regulators that my seven-year-old son will now even soon be 
able to describe--the FDIC, the CFTC, the SEC, the OCC. We must 
act in collaboration. This is a particularly great moment for 
our Nation to appreciate that we are one country. We share an 
economy and we share at least one, if not many, common goals--
the successful integrity and stability of our markets.
    I would also just like to point out one person who we 
talked about yesterday, whose mission resonates with me and 
inspires me, former Chair Brooksley Born, who looked at the 
credit derivatives market and simply asked the question, ``Is 
this something that we should study in the context of 
understanding how the market works and where the risks lie?'' I 
would just echo that here, and underscore the necessity that we 
do ensure the vibrancy of our markets. We are also especially 
mindful about the most vulnerable market participants that are 
engaged in those markets, in this context possibly retail 
market participants.
    Senator Brown. Inspector General, your comments?
    Ms. Goldsmith Romero. Thank you, Chairman Brown. First of 
all, regulation is not mutually exclusive of innovation, and we 
have a situation here where although the CFTC has the authority 
to police the spot markets, they do not regulate it and they do 
not have visibility in it. As a longstanding Federal law 
enforcement official I can tell you it is very hard to find 
fraud if you do not have visibility, you do not have access.
    I think it is absolutely appropriate to collaborate as much 
as we can. I used to work at the SEC. I know many people there. 
They are still my partner today, and I would collaborate, and I 
think we can do this in the right way to protect customers as 
best as we can, as much as we can. If Congress wants to 
consider adding additional protections, including consumer 
protections, customer protections, particularly for retail 
customers, I think that would be helpful as well.
    Senator Brown. Thank you, Inspector General. These 
investigations, as you suggest, can be exceptionally complex. 
They can take years to complete. It is important that CFTC 
pursue these complex, difficult, hard cases. Sorry, the cliche, 
it really is one step ahead of the sheriff. I mean, so many of 
these people that want to scam the system, and some of them are 
making hundreds of millions of dollars doing that, and they are 
not maybe your typical scam artists but really they are. We 
know what they did with OTC, with over-the-counter derivatives, 
we know what many of them are trying to do now, and we really, 
really need this Commission to really take this very seriously 
and working with those other agencies.
    I would add, Madam Chair, and then I conclude, that there 
are three of us on this Committee that also sit on the Banking, 
Housing, and Urban Affairs Committee--Senator Smith, Senator 
Warnock, and I. I do not believe there are any Republicans that 
are on both. It is important that there be cooperation. 
Jurisdiction should not enter into this, jurisdictional 
committee fights, nor should jurisdictional fights enter into 
it among the alphabet agencies, if you will.
    Thank you all for your willingness to serve.
    Chairwoman Stabenow. Thank you so much, and, Senator Brown, 
one of the things that causes me to be optimistic about us to 
be able to really address this important area is the fact that 
you are on this Committee and the fact that we do have a joint 
desire to figure this out. Just as Dodd-Frank figured out how 
the regulatory agencies can work together, I know we can do the 
same thing.
    Senator Brown. You and Senator Boozman have always been so 
cooperative on so many things across jurisdictions and party 
lines, so thank you both.
    Chairwoman Stabenow. Well, thank you. I think we have an 
opportunity to do something really important, so thank you. 
Senator Tuberville.
    Senator Tuberville. Thank you, Madam Chair. Congratulations 
on your nominations, ladies. I appreciate you taking time to 
appear before our Committee today and answer all of our 
questions.
    You know, the CFTC's most basic function is to oversee our 
Nation's derivatives markets. America's farmers and ranchers 
rely on these derivatives markets to hedge risk and protect 
themselves from losses after a bad year. Our country's 
agricultural industry is the envy of the world, and each of you 
will play a vital role in ensuring it stays at the pinnacle.
    As we learned at the Committee's most recent hearing, the 
CFTC is playing an increasingly larger role in the regulation 
of digital assets. If confirmed, each of you has a 
responsibility to do your part as regulators to ensure the U.S. 
continues to be the global leader in financial innovation. You 
can do this by communicating clear rules of the road to market 
participants and not regulating through enforcement.
    This is a question for all of you. If you keep your answers 
fairly short I would appreciate it. You know, I believe 
regulations should be used in a targeted way to address market 
failures. When you think broadly about the digital assets 
arena, why do you think that CFTC would be well suited to 
address market failures in this sector.
    We will start down on this end, Ms. Romero.
    Ms. Goldsmith Romero. Thank you, Senator. I do think the 
CFTC is well positioned. They have been a leader and they have 
done a nice job of balancing promoting innovation by allowing 
some new derivative products while also trying to keep the 
market free of fraud and manipulation. I also think there are a 
large number of commodities in the spot market that would fall 
under that police authority that the CFTC has.
    Senator Tuberville. Thank you.
    Ms. Johnson. Thank you so much, Senator, for that question. 
I believe the CFTC is well suited because we have an 
established track record of operating in similar spaces. That 
track record includes skills and relationships developed over 
time, engaging directly with the constituents in the energy and 
agricultural communities as well as commercial users and end 
users and financial markets. That is my thought. Thank you, 
Senator.
    Ms. Mersinger. Thank you, Senator. As you know, the 
Commodity Futures Trading Commission is set up with principles-
based regulation, and the reason that is important is because 
it does serve to foster innovation. In fact, that is in our 
mission, and that is one of the reasons why the Commission be 
well suited to oversee the crypto markets if Congress decides 
that that is what they want to do. Thank you.
    Senator Tuberville. Thank you.
    Ms. Pham. Thank you. I will just go back to something I 
mentioned before, which is that the CFTC has been doing this 
from day one, and the CFTC's markets have stood the test of 
time over and over again, through market failures and crises, 
and it will do so in the future as well.
    Senator Tuberville. Thank you. Ms. Mersinger, like me you 
come from a rural State. I know you take a lot of pride in that 
ag is the leading industry in your home of South Dakota, just 
like it is in my State of Alabama. If confirmed, how would you 
approach stakeholder engagement including ag community outreach 
as a CFTC commissioner?
    Ms. Mersinger. Thank you, Senator. I have had some 
experience in this setting. As the Designated Federal Officer 
for Agricultural Advisory Committee I stay in constant contact 
with our agricultural stakeholders, reaching out to them, 
learning more about how they are using the markets, whether or 
not the markets are working, and I plan to continue doing that. 
I will have a very open-door policy.
    I also look forward to getting out and meeting farmers and 
ranchers on their land, on their turf. While I am very familiar 
with many of the Midwestern crops, I look forward to visiting 
the Southern States to learn more about Southern agriculture 
production. Thank you.
    Senator Tuberville. We will be glad to have you.
    Ms. Pham, you spent time at the CFTC as a senior staffer, 
and from the powerful personal statement you shared today I 
know that stakeholder outreach is near and dear to your heart. 
How will you reach out to our Nation's ag community in your 
role as a CFTC commissioner, if confirmed?
    Ms. Pham. Thank you. First of all I love to travel, so I do 
hope that I also get an invitation to come on out, and that 
includes a football game too.
    I will say that one of my favorite parts of the job when I 
was at the Commission previously was meeting with our ag 
producers and growers and our end users. It is a privilege to 
hear from people who are in the real world and who are just 
trying to run their businesses and grow jobs and the economy. I 
look forward to that, and it is the same reason why I have 
enjoyed meeting with clients over these past years as well.
    Senator Tuberville. Thank all of you very much. Thank you, 
Madam Chair.
    Chairwoman Stabenow. Thank you very much. Senator Thune.
    Senator Thune. Thank you, Madam Chair. In recent years 
South Dakota's cattle producers have been deeply concerned 
about market volatility and potential market manipulation. If 
confirmed as commissioners, what would you do to protect the 
viability of cattle and other agricultural markets while also 
ensuring that hedging tools are available and priced correctly?
    Ms. Mersinger, given your agricultural background, this is 
a subject I think you know well. Let us start with you.
    Ms. Mersinger. Thank you, Senator, and yes, as you 
mentioned I do know this well and I am keenly aware of the 
concerns in the cattle markets. I think the most important 
thing here is transparency, and the best way to ensure that is 
through constant communication, and that is with the producers, 
the staff at the CFTC, and the exchanges as well. Because at 
the end of the day, we need these markets to work in their role 
as price-setting and risk management tools, and that is 
something that, if confirmed, I look forward to continuing 
working on.
    Senator Thune. Other nominees, thoughts on that?
    Ms. Johnson. Senator, thanks so much for that question. I 
want to echo my fellow nominee's reflections. We have had lots 
of time together to talk about some of these questions, and we 
agree she is an expert, so thank you for that question.
    I will be learning a lot about cattle pricing transparency 
when I take on this new role, if I should be confirmed. I hope 
to bring all of my expertise in the context that you mentioned, 
ensuring transparency in pricing, ensuring that the markets 
work for the market participants.
    I also would just underscore that with the recent COVID 
crisis and growing disruption of geopolitical events our 
agricultural markets are critical and central to the success of 
our economy. I am happy to support transparency and ensuring 
markets work effectively.
    Senator Thune. Anybody else?
    Ms. Goldsmith Romero. Senator, I appreciate this is a very 
serious issue. I watched the cattle hearing that this Committee 
had. I am looking forward to learning more about it. 
Transparency is vitally important in these derivative markets 
for them to be able to work.
    You also mentioned manipulation. I am very experienced in 
investigating market manipulation and fraud. That is an 
important area to keep these markets working, and I would bring 
that experience to the Commission.
    Senator Thune. Thanks.
    Ms. Pham. Senator, I know this is an issue with a lot of 
focus on it and there are a lot of issues impacting the cattle 
industry. There was a slaughterhouse down a few miles from my 
high school when I grew up. Transparency is foundational to 
U.S. markets and our regulatory frameworks, so if confirmed, I 
will work with your office in looking further into this.
    Senator Thune. Great. Thank you, and I just would urge all 
of you to keep this front and center. It is an issue which is 
of great interest not only in farm country but I think too, 
just in terms of the overall. In our economy, agriculture is 
critical obviously to our national economy. I am a big believer 
in free markets, but in order for free markets to work there 
has got to be competition. There is a tremendous amount of 
concentration of power, market power, within a handful of firms 
that are processing the beef that is raised in this country. 
Keep an eye on that, and I am sure we will be coming back to 
that again at another time.
    Just to followup on my first question, and I do not have a 
lot of time, but I have seen reports that some cryptocurrency 
firms are potentially interested in participating in 
agricultural markets, and I am wondering what your thoughts are 
on their participation in these traditional markets. Do you 
believe that they should abide by the same rules and 
regulations? Just if you can summarize your thoughts on that 
quickly.
    Ms. Goldsmith Romero. Yes. Thank you, Senator. CFTC has a 
principles-based regulatory framework, and those principles are 
really important. I do not believe we should be lowering the 
bar on those. Otherwise we are not really going to be able to 
keep market integrity while promoting responsible innovation. I 
look forward to learning more on this issue and getting more 
details and working to make sure we are not lowering the bar.
    Ms. Johnson. Thanks so much for that question, Senator. I 
think ensuring a level playing field has long been a commitment 
for the CFTC in terms of oversight of markets, and I think your 
question speaks directly to the necessity of ensuring that. If 
confirmed, I commit to monitor and surveil and be prepared to 
hear from constituents about their concerns regarding whether 
or not there is a level playing field.
    Ms. Mersinger. Thank you. I would echo my fellow nominees 
and just add that there is risk in having two sets of rules.
    Ms. Pham. Senator, I believe that markets work best when 
there are clear and simple rules with common standards. Any 
changes to market structure need to be careful and thoughtful 
to avoid market disruption and unintended consequences.
    Senator Thune. All right. Thank you. Thank you, Madam 
Chair.
    Chairwoman Stabenow. Thank you very much. Senator Braun.
    Senator Braun. Thank you, Madam Chair. Being from Indiana, 
forestry, growing trees, lumber business in general is 
probably, when you take all the downstream impact from it, is 
as large as row crops would be. Mostly we produce hardwoods. 
The lumber futures markets, of course, more associated with 
2x4s and such that would be softwood products. Those markets 
are used sometimes as a hedge, a way.
    There has been so much volatility with all the demand that 
was thrown into the system by what we did here to try to get us 
through COVID. I am not sure when we are going to get back to 
something that is more of a normal pattern. It did engage 
several times in the futures market where there were lock 
limits. In other words, those are designed to put a brake on 
volatile trading, but when it happens that often it begs the 
question, are they in the right place? Do you need to adjust 
them?
    I would like each witness to actually comment about, is 
that something where you should intercede in times like we have 
just gone through, and does this particular market look like it 
needs something done more long-term so that you do not have 
markets frozen up in a way that it makes liquidity difficult 
and people to maneuver accordingly?
    Start here on this end.
    Ms. Goldsmith Romero. Thank you, Senator Braun. My highest 
priority, if confirmed, would be to make sure these derivatives 
markets are working, that they are open and fair and 
transparent and they allow the hedging of risk that your 
constituents need. I think part of it is really monitoring and 
conducting surveillance at the CFTC into these markets to 
understand what exactly is going on, being able to look at the 
trading activity, being in communication with market 
participants as well as the SROs. Then it is also to look to 
see if there is any kind of manipulation, anyone trying to take 
advantage of the market during times of volatility, which can 
sometimes happen.
    Those will all be things that I would be looking at, if 
confirmed, and I am happy to get more details about this and 
talk with you and your office further.
    Ms. Johnson. Thank you so much for that question, Senator. 
It is a very thoughtful question that really requires us to be 
engaged in attempting to understand the market well. Your 
question demonstrates that the critical pieces of oversight, or 
pieces to the oversight puzzle that the CFTC maneuvers.
    I would note that in moments of increased volatility in 
markets or disruption the CFTC typically engages in heightened 
surveillance, monitoring more closely, on the phone, you know, 
folks on the phone line, to ensure that they have a clear 
picture, they have great visibility into markets, seeking 
superior and real-time data to ensure that if there is 
activity, misconduct or inappropriate trading activity, that 
that is seen to right away. It is imperative to see the 
downstream effects on counterparties and to think carefully 
about whether, as you describe, markets are working 
effectively.
    I can commit, if confirmed, to certainly being engaged in 
careful monitoring and ensuring proper oversight.
    Ms. Mersinger. Thank you, Senator Braun. What I will say is 
I was at the CFTC during the pandemic when we were seeing these 
record volatilities, and I was aware of the number of days that 
they had limit down days, and it was definitely a concern, 
something that we monitored very closely. I can tell you that 
there is staff at the CFTC that pay very close attention to 
this, keep in touch with the stakeholders and the exchanges, to 
make sure the markets function. Certainly, if confirmed, I 
would be happy to talk to those experts at the Commission and 
report back to your office any information I can provide as to 
how the lumber markets are functioning at this time.
    Ms. Pham. Senator, in addition to what my fellow nominees 
have stated, you know, the way how limits are set is an 
important issue, and I think the CFTC, with its different 
processes around how limits are set, and also with the 
exchanges, the importance of public engagement throughout that 
process is something that definitely should be upheld and is 
something that, if confirmed, I look forward to working with 
the Chairman and others on.
    Senator Braun. Thank you all.
    Chairwoman Stabenow. Thank you very much. I believe we have 
Senator Hoeven with us online. Senator Hoeven? Senator Hoeven, 
are you with us?
    Senator Hoeven. I am sorry. I thought I had unmuted. Maybe 
it got muted. Can you hear me now?
    Chairwoman Stabenow. Yes. Every one of us does that at 
least once every day, so welcome to the club.
    Senator Hoeven. I know. Exactly. Thank you, Madam Chair, 
and let me start with a question for all the witnesses. 
Essentially, your subcommittee put out a report, ``Managing 
Climate Risk in the U.S. Financial System,'' and I want to get 
your response in regard to that.
    In North Dakota we produce 1.1 million barrels of oil a 
day. We produce huge amounts of natural gas. We have coal-fired 
electricity. I would like each of you to respond on whether you 
think there should be preferences for one commodity fuel type 
over another, in terms of this climate risk report.
    Ms. Pham. Senator, thank you, and North Dakota has a 
special place in the hearts of my family, as I said in my 
statement.
    You know, climate is a hard issue that needs to be 
thoughtfully studied, and I believe in the power of the markets 
to provide solutions here, and there are opportunities to have 
new products to deal with the physical and transition risk, so 
thank you.
    Ms. Mersinger. Senator, just to echo what my fellow nominee 
said, I think that it is important that our work at the CFTC 
remains neutral as to the commodity, that we are making sure 
that these markets function regardless of the underlying asset.
    Ms. Johnson. Thank you so much, Senator, for that question. 
I believe that the CFTC has a long history of even-handed 
engagement in the context of markets, and I would imagine that 
tradition should continue. I appreciate and understand your 
question and agree that there should be no preferences.
    Ms. Goldsmith Romero. Thank you, Senator Hoeven. The 
derivatives markets are incredibly important in the energy 
sector to help manage that risk. As we move forward, I think 
the CFTC's role is just to really try to engage and understand 
that risk, and to be fully engaged with stakeholders, to listen 
to all sides, and look at the facts. If confirmed, that is what 
I would do.
    Senator Hoeven. Ms. Mersinger, I understand that you worked 
with Senator Thune for quite a while as a member of his staff. 
That is great. You certainly understand agriculture in our part 
of the world. Tell me, you know, what can CFTC do that really 
is going to help our farmers and ranchers manage their risk? I 
mean, it is a hard thing to do. What can the CFTC do, in your 
opinion, to really make a difference for them?
    Ms. Mersinger. Thank you, Senator Hoeven, and I will say 
that I have a number of family members in North Dakota, and I 
enjoyed many long car trips up north as a child.
    Senator Hoeven. Yes, we love South Dakota. Yes, we love our 
neighbor State.
    Ms. Mersinger. As far as, you know, how we work with 
America's farmers and ranchers to help them hedge risk and use 
the CFTC markets, it is important to note that that is where 
our markets started, and the idea was to ensure that farmers 
and ranchers were able to have adequate price discovery in 
their markets and also the tools to hedge their risk. We should 
never get away from that, and we need to always be engaged with 
those stakeholders to ensure that those markets are working 
that way.
    The other thing I would add is we do have an Office of 
Education and Outreach, and I think that we could use that 
office to better engage with the farmers and ranchers to help 
them understand these markets and how they can be useful.
    Senator Hoeven. Thank you. Ms. Romero, just a wrap-up 
question here. Address cryptocurrency and how we are going to 
regulate that and give consumers some knowledge of how it 
works. I mean, it is just incredibly complicated. I think 
people are really scratching their heads. What can CFTC do to 
really help in that realm?
    Ms. Goldsmith Romero. Thank you, Senator. I appreciate 
that. I think a lot of people are getting confused by this. 
There has been this explosive growth, particularly in the 
retail market, where you have people who are buying crypto on a 
phone app, who may not understand there is a lack of customer 
protections, particularly if they are doing a transaction side 
by side with another transaction that does have the customer 
protections.
    I think the CFTC should continue to be a leader. I think 
they should help do the best they can to keep the market as 
safe as possible. They do have authority to police the spot 
market, but they do have limited visibility, and I think this 
is an area where Congress could help.
    I do think we have to balance the mission--this is what I 
will be grounded in, if I am confirmed--of promoting part of 
the mission to promote vibrant markets while also keeping them 
safe and doing it in a way that promotes market integrity.
    Senator Hoeven. Thank you. Thank you to all the witnesses, 
and thank you to you, Madam Chair.
    Chairwoman Stabenow. Thank you so much. I believe we do not 
have other Senators wishing to ask questions at the moment, so 
let me thank you again for being here today. Again, I am 
excited about the quality of the four nominees in front of us. 
We will be working to move your nominations forward as quickly 
as possible.
    This concludes today's hearing. The record will remain open 
until tomorrow at 5 p.m. for members to submit additional 
questions or statements. The hearing is adjourned.

    [Whereupon, at 11:23 a.m., the Committee was adjourned.]

      
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