Sen. Carl Levin (D-Mich.), who leads the Permanent Subcommittee on Investigations, said that lawmakers may use subpoena power to examine banks’ trading and ownership of physical commodities, Bloomberg News reported yesterday. “We have been into this issue for a long time and it’s a very, very significant issue,” Levin said after a Senate Banking subcommittee hearing yesterday led by Senator Sherrod Brown on whether power plants and oil refineries should be owned by financial holding companies such as JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley. The potential for conflicts of interest and manipulating prices to benefit their proprietary holdings “is huge,” said Levin, whose subcommittee held hearings over Goldman Sachs’s packaging and sale of toxic mortgage-backed securities and JPMorgan’s “London Whale” trading losses.
