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Senate confirms Massad to head financial agency

By WTOP Staff

MARCY GORDON
AP Business Writer

WASHINGTON (AP) — The Senate on Tuesday confirmed President Barack Obama’s choice to head an agency overseeing potentially risky financial market activities.

Timothy Massad, who has promised to act aggressively against misconduct to ensure investors’ confidence, was approved as chairman of the Commodity Futures Trading Commission.

The CFTC, which regulates futures and options markets as well as derivatives trading, oversees some of the riskiest corners of the financial world. Derivatives were blamed for fueling the financial crisis.

Massad, a Treasury Department official, will succeed Gary Gensler, a Wall Street veteran who surprised many by becoming a tough regulator who pushed for strict rules that were opposed by large banks.

Also confirmed were two nominees to fill vacancies on the CFTC panel: securities lawyer Sharon Bowen and brokerage firm executive J. Christopher Giancarlo.

Bowen will fill a Democratic seat on the five-member commission, Giancarlo a Republican one.

Massad has said he would pursue final action on a revised rule aimed at clamping down on speculative trades that can drive up food and gas prices. The CFTC’s original rule was struck down in 2012 by a federal court.

Commissioner Mark Wetjen has been acting chairman of the agency since Gensler left in December.

Massad, Bowen and Giancarlo had their confirmation hearing before the Senate Agriculture Committee in March. But Senate approval was delayed by objections to Bowen from several Republican senators. Sen. Saxby Chambliss, R-Ga., had voted against her in the Agriculture Committee, saying she wasn’t qualified. Other Republicans cited Bowen’s role as the acting head of the Securities Investor Protection Corp., which insures brokerage firms, in its decision not to compensate victims of the $7 billion Ponzi scheme run by convicted former Texas tycoon R. Allen Stanford.

Bowen received a close vote in the Senate Tuesday, 48-46. Massad and Giancarlo were approved by voice vote.

For three years, Massad oversaw the Treasury’s Troubled Asset Relief Program, the bank bailout program that was launched in response to the financial crisis that struck in 2008. Under TARP, the government lent about $424 billion to bail out financial companies and automakers. The companies have repaid $373 billion.

Massad will oversee the implementation and enforcement of CFTC rules that were enacted to meet the agency’s mandate under the 2010 financial overhaul law.

Before joining the government, Massad was a corporate attorney for 24 years at a leading white-shoe law firm, Cravath, Swaine & Moore.

After the crisis, the CFTC brought the secretive $600 trillion market for derivatives under regulation for the first time. The goal was to prevent another crisis and resulting taxpayer bailout.

The value of derivatives is based on a commodity or security, such as oil or currencies. They are often used to protect businesses that produce or use the commodities, such as farmers or airlines, against price fluctuations. But they also are used by financial firms to make speculative bets.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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