For the first time, the CFTC has fined a company for poor cybersecurity practices that resulted in a third-party breach of the company’s information systems.  This development is consistent with an increasing trend of regulators holding companies responsible for the cybersecurity failures of third-party service providers.

AMP Global Clearing LLC … Read More

Among the virtual currency transactions that are within the scope of CFTC regulation are leveraged, margined, or financed transactions in virtual currencies offered to retail customers. These retail commodity transactions are illegal unless traded on a regulated futures exchange and cleared through a futures commission merchant. They include any transaction: … Read More

With virtual currency markets booming and bitcoin prices at record highs, U.S. financial regulators have been—each in its own manner—considering whether and how to regulate virtual currencies and related products.  Last week, the U.S. Commodity Futures Trading Commission (CFTC) announced that three futures exchanges—CME, Cboe Futures Exchange, and Cantor Exchange—self-certified … Read More

Among the many topics covered by the Treasury Department’s recent report[1] on the asset management and insurance industries are recommendations to simplify the regulation of commodity pool operators (CPOs) and commodity trading advisors (CTAs), particularly for those that are regulated by both the Commodity Futures Trading Commission (CFTC) and … Read More

The U.S. Treasury’s new Capital Markets Report recommends additional administrative requirements for regulatory actions by the SEC and the CFTC (the “Agencies”).  If adopted, the process by which the Agencies issue new regulations and guidance may be more transparent and subjected to more rigorous cost-benefit analysis.  Rulemaking and issuing no-action … Read More

CFTC Chairman Giancarlo testified this morning that he intends to delay for an additional year a decision on whether to modify the currently effective swap dealer de minimis registration threshold of $8 billion notional of dealing swaps.[1] This request follows on the heels of a recommendation by the U.S. Treasury, … Read More

There has been significant attention to the first major policy speech by the CFTC’s newly-minted Enforcement Division Director, James McDonald on September 25, 2017.  Mr. McDonald’s speech outlined the Enforcement Division’s updated approach to self-reporting and cooperation, as described in an enforcement advisory update issued to coincide with his speech … Read More

Yesterday, the Commodity Futures Trading Commission brought an enforcement action against the operators of an alleged Ponzi scheme who, according to the allegations, collected approximately $600,000 from 80 investors in a pooled fund to invest in bitcoin under a high-frequency, algorithmic trading strategy. The operators instead allegedly misappropriated the funds … Read More

In the August 25th episode of the CFTC podcast, CFTC Talks, the new Director of the CFTC’s Enforcement Division, James McDonald, discussed his priorities for the Division (transcript here), including providing incentives for entities to self-report non-compliance issues to the CFTC.

McDonald stressed that as part of … Read More

In a closely watched case, the Seventh Circuit last week affirmed the felony conviction of Michael Coscia, a New Jersey high frequency trader, rejecting his arguments that the anti-spoofing provision in the Commodity Exchange Act under which he was charged is unconstitutionally vague and that the evidence in the … Read More