The CFTC cracks the regulatory whip

Darren Sinden

From January 1, 2020 to date, the CFTC has dished out 113 regulatory actions. Chairman and CEO Heath Tarbert is proud of this and elaborates on the CFTC’s results in censuring firms and individuals, large and small, which seek to transgress

US futures and options regulators have been busy in 2020 recently published data shows the Commodity Futures Trading Commission (CFTC)’s enforcement division has posted a new record number of enforcement actions across the course of 2020 to date.

The 113 actions made by the division racked up $1.30 billion in fines and penalties, a figure that was boosted by the largest fine in CFTC history, which backed up the promises of robust regulation from the CFTC, under the stewardship of Chairman and CEO Heath Tarbert

The previous record for the number of annual enforcement actions was 102, whilst the CFTC’s annual 30-year average is way down at just 58 cases.

Speaking about the record number of enforcement actions Mr Tarbet said

“A strong enforcement program at the CFTC is critical to the proper functioning of our derivatives markets and the health of the American economy overall,”

and that

“Without integrity, these markets, markets that inform the price of everything from food to gasoline to interest rates on home mortgages—simply would not work”

Mr Tarbet’s enforcement team have caught some high profile names in their net during 2020. Deutsche Bank agreed to pay $10 million back in June to settle actions around alleged spoofing and breaking data disclosure requirements, whilst Citigroup is set to pay a penalty of $4.5 million, after millions of voice recordings of traders and other audio files were deleted, even though some of the data had previously been subpoenaed by the derivatives watchdog.

Nearly half of the cases pursued by the CFTC enforcement division involved retail fraud, and 24 cases centred on the protection of customer funds with regard to their supervision and integrity.

Whilst there were 16 cases of manipulative conduct or spoofing, the CFTC data showed that 50 out of the total 113 counts involved charges against one or more individuals.

Actions against market manipulators raised $920 million in penalties and disgorgement of profits, and 2020 saw two of the largest cases of their kind in the CFTCs history.

The enforcement division worked with other agencies including Federal and State authorities in both civil and criminal capacities.

2020 was also a good year for whistleblowers to the CFTC, which authorised the payment of $20 million of rewards to those who highlighted rule-breaking and illegal behaviour.

The CFTC recently published a much-awaited report into the negative pricing of WTI crude oil futures, seen in the spring. The report was comprehensive at 37 pages long but it stopped short of naming names, or explaining exactly how and why prices for the expiring crude oil contract plunged below zero.

Mr Tarbet said at the publication of the report that a definitive analysis of the causes was not available at this time, but he wouldn’t be drawn on whether one would ultimately be forthcoming.

Read this next

Market News

Stock Market Analysis: Is NVDA Losing Its Leadership?

Since the beginning of the week, the S&P 500 Index (US500) has seen a modest increase of about 0.58%, whereas NVDA’s share price has experienced a decline of approximately 3.8%. This recent divergence raises concerns among Nvidia stock investors — could it signify a loss of NVDA’s market leadership?

Industry News

ESG: Australian regulator wins first greenwashing court case against Vanguard

Vanguard admitted that a notable portion of the securities within both the Index and the Fund did not undergo the promised ESG scrutiny.

Fintech, Uncategorized

BitMEX integrates HALO from Solidus Labs for cross-market surveillance

““The recent approval of the Spot Bitcoin ETF has piqued the market’s interest. As a result of price volatility, the trading volumes for crypto derivatives have gone up substantially. HALO, with its advanced technology and crypto-native detection architecture, will enable BitMEX to smoothly and safely scale trade surveillance across its increased trading volumes and provide the necessary safeguards for new product launches.”

Reviews

IUX Broker Review

IUX, recently rebranded from IUX Markets, stands as a multi-asset Forex broker recognized for its regulatory compliance across various jurisdictions.

Industry News

Horizon Software rebrands to Horizon Trading Solutions

“Horizon Trading Solutions has seen accelerated global growth over the past year to meet the rising demand for our trading solutions and built-for-purpose technology offering. The choice to rebrand represents a key part of this development, while maintaining our heritage and history in the industry.”

Market News

USDJPY has surged to levels last witnessed in 2022. Should we consider opening a short position?

The recent resurgence of the US dollar has propelled USD/JPY to new heights, touching levels not seen since 2022. This surge comes against the backdrop of stable short-term yields and ongoing economic data that fails to signal a significant slowdown, prompting questions about the extent of current monetary easing measures.

Digital Assets

DED Trends on Twitter After Memecoin Snapshot Announcement

Polkadot-backed community coin #DED, made it to the trending charts on X, demonstrating community’s engagement and interest behind the memecoin. 

Digital Assets

BlockDAG Presale Nears $10 Million Amid Toncoin’s Momentum, Green Bitcoin’s Presale, and the Rise of Other Top Cryptos

This article will examine three top trending topics: Toncoin’s potential, Green Bitcoin’s innovative presale, and BlockDAG’s sustainable mining approach. These cryptocurrencies take centre stage for their uniqueness and innovation.

Digital Assets

Coinbase scores minor victory vs SEC, but lawsuit to proceed

A federal judge in Manhattan, U.S. District Judge Katherine Polk Failla, ruled on Wednesday that the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Coinbase can largely proceed.

<