Frank: Congress to clamp down on derivatives

The chairman of the House Financial Services Committee says that Congress will substantially increase the power of government regulators to monitor derivatives, a type of financial instrument that contributed to the U.S. economic turmoil.

Rep. Barney Frank, a Democrat, said at a hearing Friday that he cares less about which agency will be given the task than about making sure that it is done.

Treasury Secretary Timothy Geithner was testifying before the House committees on financial services and agriculture on the administration’s plan to regulate privately traded derivatives.

Derivatives are financial instruments whose values are based on something else, such as a mortgage-backed security or a commodity like oil.