The Money Cop

Gary Gensler got his start on Wall Street. Now he's cleaning it up--and taking on the biggest banking scandal since the financial crisis

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Reed Young for TIME

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When 2013 kicks off, Gensler can notch the end of another bad practice as an accomplishment. On Dec. 31, the U.S. will become the only nation to require domestic and international dealers of swaps who are conducting business in America to register with regulators. The new reporting rules might have allowed regulators to see that a company like AIG--which had to be bailed out with $180 billion in taxpayer money--was taking risky bets in the derivatives markets. "Would that have prevented AIG from taking those bets?" asks Gensler. "Maybe not. But at least we would have known. You always feel safer on a lit street rather than a dark one."

Shining a light in the darkest corners of finance hasn't won Gensler many friends. "He's dealt with a lot of very uncooperative people," says Congressman Barney Frank. Among them: a Congress that has underfunded the CFTC (which has only 10% more staff than it did in the 1990s, when markets were much smaller) and banking-industry lobbying groups that are continually suing the agency. Indeed, some insiders speculate that if Gensler hadn't made so many enemies in finance in the past few years, he might be a contender for a bigger gig, like head of the SEC or Treasury. He shrugs at the idea. "It's a privilege to see this job through. These rules [we are enforcing] really can help shift advantage from Wall Street to the rest of the economy." In a country still rife with financial scandal, where people have come to believe that the system is rigged against the little guy, that's as important a job as any.

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