The History of the CFTC

2019 ◽  
pp. 366-396 ◽  
Author(s):  
Alan N. Rechtschaffen
Keyword(s):  
Commodity Futures ◽  
Disciplinary Action ◽  
Market Place ◽  
Futures Trading ◽  
Wall Street ◽  
President Obama ◽  
Exclusive Jurisdiction ◽  
Consumer Protection Act ◽  
History Of ◽  
Commodity Futures Trading Commission

The Commodity Futures Trading Commission (CFTC) is an independent agency with exclusive jurisdiction over futures trading in all commodities. The Commodity Exchange Act of 1936 (CEA) set forth the first federal regulatory framework for futures trading in agricultural commodities. In 1974, Congress passed the Commodity Futures Trading Commission Act, overhauling the CEA and establishing the CFTC. When President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act into law, the CFTC was a natural regulatory authority for the implementation of Dodd-Frank because of its historical role in regulating a remote corner of the derivatives market place (i.e., futures). This chapter discusses the role of the CFTC, its structure, disciplinary action, and its regulatory background.

Securities Regulation

2019 ◽  
pp. 287-324
Author(s):  
Alan N. Rechtschaffen
Keyword(s):  
Hedge Funds ◽  
Financial Regulation ◽  
Regulatory Reform ◽  
Securities And Exchange Commission ◽  
Securities Regulation ◽  
Futures Trading ◽  
Product Lines ◽  
Wall Street ◽  
Consumer Protection Act ◽  
Commodity Futures Trading Commission

Prior to the 2007 financial crisis, financial regulation was compartmentalized along lines of segmented financial instruments. With the exception of the regulation of swaps as described in chapter 14, post-crisis regulatory reform maintains this bifurcation of regulation along product lines between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The SEC and the CFTC have begun to issue rules establishing a coordinated approach to regulating certain derivatives under the Wall Street Reform and Consumer Protection Act (widely known as the Dodd-Frank Act) in particular as they relate to swaps. This chapter discusses the jurisdiction of the SEC, what constitutes a security, sellers’ representations, consequences of securities, hedge funds, and derivatives regulation.

Differentiating Centralization and Overlap in Swap Regulation

2019 ◽  
pp. 127-148
Author(s):  
Alejandro E. Camacho ◽  
Robert L. Glicksman
Keyword(s):  
Securities And Exchange Commission ◽  
Commodity Futures ◽  
Title Vii ◽  
Regulatory Regime ◽  
Securities Markets ◽  
Futures Trading ◽  
Commodity Futures Trading Commission ◽  
Legislative Changes ◽  
Over Time

This chapter explains how legislative changes to, and the broader commentary on, US derivatives regulation illustrate the value of parsing the overlap/distinct and centralization/decentralization dimensions in assessing the tradeoffs of regulatory allocations. The Securities and Exchange Commission and the Commodity Futures Trading Commission have been tasked with decentralized authority over securities and futures, respectively. Over time, their jurisdictions have increasingly overlapped as the futures and securities markets converged. Reorganization proposals and legislation to correct perceived problems with the overlapping, decentralized regulatory regime (such as Title VII of the Dodd-Frank Act) have usually failed to parse the various tradeoffs between overlap and distinct or between centralized and decentralized authority. By limiting their analysis, policymakers and observers of derivatives regulation may have misdiagnosed problems with the existing allocation or missed potential opportunities to craft different regulatory configurations that might have better accommodated policy tradeoffs or been more politically viable.

In or out? – the CFTC explains when virtual currencies come within its jurisdiction

2020 ◽  
Vol 21 (2/3) ◽  
pp. 167-169
Author(s):  
Daniel Nathan ◽  
Nikiforos Mathews
Keyword(s):  
Design Methodology ◽  
Leadership Role ◽  
Commodity Futures ◽  
Futures Trading ◽  
Virtual Currency ◽  
Content Type ◽  
Judicial Decisions ◽  
History Of ◽  
The U.S

Purpose To summarize and explain the U.S. Commodity Futures Trading Commission’s (CFTC’s) guidance regarding whether cryptocurrency is subject to CFTC jurisdiction. Design/methodology/approach The article reviews the CFTC’s March 24, 2020 final interpretive guidance, summarizes the history of the agency’s jurisdiction over leveraged, margined or financed retail transactions, and relates it to the CFTC’s guidance and judicial decisions regarding cryptocurrency. Findings We found that the CFTC, in carrying out its leadership role related to developments in the fintech industry, had provided clarity about its jurisdiction over cryptocurrency. The CFTC defines virtual currency as a “commodity,” even if intangible, and finds that many transactions in virtual currency satisfy the exception to the CFTC’s jurisdiction over leveraged retail commodity transactions because “delivery” can be said to occur within 28 days. Originality/value The article provides a useful summary of an important pronouncement from the CFTC in a manner that is readily understandable and relatable to industry participants and legal practitioners in this field.

Commodity Exchanges and Regulation

2018 ◽  
Author(s):  
Jerry W. Markham
Keyword(s):  
Foreign Currency ◽  
Securities And Exchange Commission ◽  
Commodity Futures ◽  
Futures Trading ◽  
Financial Responsibility ◽  
Market Participants ◽  
Futures Options ◽  
Currency Exchange ◽  
Financial Derivative ◽  
Commodity Futures Trading Commission

The U.S. Commodity Futures Trading Commission (CFTC) intensively regulates commodity futures, options, and swaps pursuant to the provisions of the Commodity Exchange Act of 1936. The Securities and Exchange Commission (SEC) and federal banking agencies also have some jurisdiction over derivative financial instruments. This chapter describes the CFTC regulations, including registration requirements for designated contract markets, clearinghouses, and various swap market participants. It also describes the financial responsibility requirements imposed on futures commission merchants and safeguards for customer funds in the futures markets. Additionally, the chapter addresses prohibitions against misleading sales activities, deceptive trading practices, and price manipulations. Finally, it reviews the role of the SEC and bank regulators in regulating financial derivative contracts, particularly securities derivatives and foreign currency exchange transactions.

CFTC enforcement trends in 2017 and considerations for 2018

2018 ◽  
Vol 19 (3) ◽  
pp. 17-21
Author(s):  
Peter Malyshev ◽  
Jennifer Achilles ◽  
Jill Ottenberg ◽  
Jessica Stumacher
Keyword(s):  
Design Methodology ◽  
Commodity Futures ◽  
Futures Trading ◽  
Content Type ◽  
Commodity Futures Trading Commission ◽  
Recent Trends ◽  
Enforcement Activity

Purpose This paper aims to discuss the types of cases that were brought by the Commodity Futures Trading Commission (CFTC) in 2017 and what to expect in 2018. Design/methodology/approach This paper discusses the overall statistics regarding enforcement actions brought by the CFTC, as well as the amount of restitution, disgorgement and penalties collected in 2017. These statistics are contrasted with the same statistics from 2016. This paper also discusses the types of enforcement actions brought by the CFTC in 2017 and identifies and analyzes trends. The analysis also includes a discussion of what to expect in 2018. Findings This paper concludes that 2017 was a year filled with personnel changes and vacancies at the CFTC, which resulted in no major policymaking cases being brought by the CFTC. This paper also finds that the CFTC is focused on actively monitoring the markets, and will continue to pursue actions involving reporting violations, fraud, manipulation, cryptocurrencies, and disruptive trade practices while rewarding parties for self-reporting and cooperation. Originality/value This paper contains valuable information from experienced lawyers regarding personnel changes at the CFTC, recent trends in CFTC enforcement activity and what to expect in 2018.

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