The CFTC’s Reparations program is designed to provide an inexpensive, expeditious, fair, and impartial forum to handle customer complaints and resolve disputes between futures customers and commodity futures trading professionals. Part 12 of CFTC's regulations, 17 CFR 12, contains rules relating to Reparations. Read the informational booklet about the reparations program.
If you are a futures or options customer, or a leverage contract customer, and you have a dispute with your futures trading professional that you cannot resolve, you may be able to use the Reparations program if:
Be aware that the information provided here is not legal advice. If you think you need legal advice from a private attorney, review the section Do You Need an Attorney?.
|How the Reparations Process Works||Case Status Inquiries|
|Check Registration Status|
Allege Violations or Illegal Activities
Select Type of Proceeding
Compare the Three Types of Proceedings
File a Complaint
|You may make status inquiries and ask for procedural information at any time from the Office of Proceedings by telephone at 202-418-5250, Fax to 202-418-5532 or email.|
Complaints must involve a commodity futures trading professional registered with the CFTC who is alleged to have engaged in activities that violate either the Commodity Exchange Act or CFTC regulations. Check registration status of futures trading professionals with the National Futures Association's BASIC or contact the CFTC's Office of Proceedings.
You must allege one or more violations of illegal activities in your complaint and provide evidence to support your claim. Illegal activities include, but are not limited to:
Additional Criteria for Filing a Complaint
Before your claim can be considered under the CFTC’s Reparations program, you must satisfy these criteria:
Before filing a complaint, you must choose which of the three types of Reparations proceeding you wish to begin:
Voluntary proceeding available for claims of any amount: This is the quickest proceeding since it does not involve a hearing or allow appeals. Cases are decided by a Judgment Officer solely on the basis of written submissions and exhibits provided by the parties.
Summary proceeding available for claims of $30,000 or less.
If you do not select the voluntary proceeding, you must select the summary proceeding if your claim is $30,000 or less. Cases are decided by a Judgment Officer on the basis of written submissions and exhibits provided by the parties and, if necessary, by an oral hearing.
Formal proceeding for claims involving more than $30,000.
If your claim is for more than $30,000 and you did not select a voluntary proceeding, you must select a formal proceeding. A non-refundable filing fee of $250 must be submitted when the complaint is filed.
|Feature||Voluntary Proceeding||Summary Proceeding||Formal Proceeding|
|What is the filing fee?||$50||$125||$250|
|Is there a limit to the amount of damages I can claim?||No limit.||Yes. Your damages must total $30,000 or less.||No. But your claim must be for more than $30,000.|
|How will I submit my evidence?||All evidence is submitted in writing. There is no oral hearing.||All evidence is submitted in writing, but the Judgment Officer may order a telephonic oral hearing or a hearing in Washington, DC, if all parties prefer.||In addition to the parties' documentary evidence, an oral hearing will be held before a Judgment Oficer or Administrative Law Judge.|
|Who must agree to this type of proceedings?||All parties must consent.||Mandatory for claims of $30,000 or less unless all parties choose the voluntary procedure.||Mandatory for claims above $30,000 unless all parties choose the voluntary procedure.|
|What kind of decision will I receive?||A decision as to whether a violation has been proven, and if so, the amount of the award.||The Administrative Law Judge or Judgment Officer will issue an initial decision containing findings of fact and conclusions of law.|
|If I don't like the decision, can I appeal?||No appeal is allowed.||You may appeal the decision, first to the Commission ($50 filing fee) and then to a U.S. Court of Appeals.|
|If I win, can I collect costs I incurred and prejudgment and post-judgment interest?||No. The filing fee normally will be awarded, but no other costs or prejudgment interest. Post-judgment interest may be awarded, if you prevail||Prejudgment and post-judgment interest and the filing fee are awarded in summary and formal proceedings. The Judge also may award necessary litigation costs, such as fees for an expert witness. You will not, however, be granted non-essential costs such as telephone calls, copying fees, or travel expenses.|
|If I hire an attorney, can I recover my attorney fees?||The Commission does not allow recovery of attorney fees unless there is an enforceable contract that provides for an award of attorney fees or the other side engaged in bad-faith litigation tactics. Strongly denying a claim is not bad-faith litigation.|
|If the respondents hire an attorney, can they recover their attorney fees from me?||The Commission does not allow recovery of attorney fees unless there is an enforceable contract that provides for an award of attorney fees or the other side engaged in bad-faith litigation tactics. Strongly denying a claim is not bad-faith litigation.|
|If I win and the respondents don't pay, how do I collect my award?||If a reparations award is not paid, you may file a certified copy of the decision (available from the CFTC Proceedings Clerk) in a U.S. District Court to enforce payment. The District Court judge will have discretion to award you attorney fees and costs incurred in enforcing the award. If a person or firm fails to pay the award, their CFTC registration and trading privileges are automatically suspended until the award is paid.|
Complete CFTC Form 30: Reparations Complaint Form. The complaint and the appropriate filing fee may be filed in person or sent by certified or registered mail to the CFTC's Office of Proceedings. The Reparations Complaint Checklist is a convenient tool to use to confirm that you have included all necessary information with your complaint.
A complete complaint must include:
If you are filing a complaint, please review the information below for your calculation of damages by type of claim.
The Commission amended its regulations to clarify that post-judgment interest shall run on all reparations awards resulting in judgment for the complainant. The losing party is required to pay post-judgment interest on the reparations award (as well as any prejudgment interest ordered by the presiding official). Such interest shall run according to the terms of 28 U.S.C. 1961 and pursuant to 12.4079d) of the reparations rules. The losing party is liable for post-judgment interest even if the post-judgment interest is inadvertently omittted from the decision that imposted the reparations award.
The Office of Proceedings will review your complaint to determine if it meets the criteria for a valid claim.
CFTC staff will notify you when and if your complaint has been accepted.
When your complaint is accepted, the Office of Proceedings will forward copies of the complaint to the individuals and firms you named as respondents. Respondents may reply to the complaint by either paying you the full amount of damages claimed or a lesser sum mutually agreed upon as full satisfaction of the claim; or by filing an answer denying any liability to you. Respondents are required to send a copy to you (and all complainants).
Note that in certain circumstances a respondent may file a counterclaim with the answer to your complaint.
CFTC staff will review the answer and your case will be assigned to a judge. If no answer is received from the respondents, CFTC staff will forward your complaint to a Judgment Officer who may issue a default judgment.
Before your complaint is forwarded to respondents, you may withdraw it by notifying the CFTC in writing that you wish to withdraw your complaint—a Notice of Withdrawal.
Once you have sent the CFTC a Notice of Withdrawal, you may:
Your filing fee will not be refunded.
After your complaint has been forwarded to respondents, you may not withdraw your complaint without the consent of the respondents. When you have obtained that consent, the CFTC will issue an Order of Voluntary Dismissal.
You may not refile your complaint with the CFTC once an Order of Voluntary Dismissal is issued.
Once CFTC staff determines that a reparations proceeding has met the specified requirements, which may take from two to six months depending on the number of deficiencies that you and the respondents must correct, the case is forwarded to the CFTC Proceedings Clerk for assignment to a presiding official.
Voluntary and summary proceedings normally are assigned to a Judgment Officer; formal proceedings may be assigned to either a Judgment Officer or an Administrative Law Judge.
You will receive a notice of the assignment to a judge, which will also authorize you to begin gathering evidence in support of your claim.
After you are notified that your case has been assigned to a presiding official, you may not discuss the facts of your case with the presiding official or any member of his staff without the other parties being present or, in the case of a written communication, without simultaneously sending a copy of your letter to the other parties. This prohibition against ex parte communications applies to all parties to the case. If you violate the rule against ex parte communications, your case may be decided against you.
You may provide evidence in support of the allegations of your complaint in many forms, including:
Parties are responsible for gathering their own evidence.
To obtain evidence that is in the hands of the other side or held by third parties, each side may make a formal request during discovery.
Discovery requests can be in any or all of three forms:
No party may request personal tax returns or personal bank records during discovery unless the judge grants permission.
Abuse of the discovery rules can lead to sanctions, including assessment of costs against the abusing party.
After your complaint is assigned to a presiding official, he will review your evidence and, depending on the type of proceeding you selected, will take the necessary steps before issuing a decision. The time until you receive a decision on your complaint varies widely and depends on factors such as the complexity of the issues and the facts; whether you and the respondents provide requested information quickly; whether there are disputes about procedural issues; and whether an oral hearing is required and when can be scheduled easily. Sometimes, a presiding official approves a “stay” in a case, putting the procedure on hold due to the health of a party or for other reasons requested by a party and approved by the presiding official.
Typical voluntary proceedings are decided in about six months after the Judgment Officer receives the case, while summary and formal proceedings typically require anywhere from two months to eighteen months. All cases are different and times may vary significantly. The length of time required for the Commission to decide an appeal varies from case to case depending on a combination of factors, including the complexity of legal and factual issues in a particular case.
Voluntary proceeding. If you and the respondents named in your complaint all agree to use the voluntary proceeding, neither you nor the respondents may appeal the decision to any higher level. The decision reached is final.
Summary or formal proceeding. If your claim was considered in a summary or formal proceeding, the losing party may appeal an adverse decision (or an adverse part of a decision) to the Commission. There is a $50 filing fee for an appeal to the Commission. The Commission may reverse, modify, or affirm the initial decision.
Appeal to U.S. Court of Appeals. A losing party may appeal a decision by the Commission to a U.S. Court of Appeals. Appellate rules are strictly enforced at both the Commission and U.S. Court of Appeals levels, and any failure to observe those rules may result in losing the appeal.
Payment in 45 days. Under the law, the respondents must pay you any award within 45 days unless one of the respondents appeals the decision.
Failure to pay. If none of the respondents appeals the decision and the respondents do not pay your award, the Commission will automatically revoke the license and trading privileges of any respondent who fails to pay and fails to report to the Commission that payment has been made. The industry and the public is notified of the revocation and suspension through publication of the CFTC's Reparations Sanctions in Effect.
Collection of an award. The Commission cannot help you collect your award. You may obtain a certified copy of your decision from the CFTC's Proceedings Clerk. If the respondent does not pay the award, you can attempt to enforce the award by filing a certified copy of the reparations decision in the U.S. District Court that is in the district where the respondent lives or has a principal place of business. If the District Court enforces the award, the court normally will require the respondent to pay all court costs and any legal fees incurred in enforcing the award.
Interest. The Commission amended its regulations to clarify that post-judgment interest shall run on all reparations awards resulting in judgment for the complainant. The losing party is required to pay post-judgment interest on the reparations award (as well as any prejudgment interest ordered by the presiding official). Such interest shall run according to the terms of 28 U.S.C. 1961 and pursuant to 12.407(d) of the reparations rules. The losing party is liable for post-judgment interest even if the post-judgment interest is inadvertently omitted from the decision that imposted the reparations award.
Filed by respondent. A respondent can file a counterclaim against you if it stems from the same set of facts that are the subject of your claim. Counterclaims usually seek to recover a debit balance in an account you held with the respondent. If a counterclaim is filed against you, you will be sent a copy and you must file a reply within 30 days.
Decision against you. If a respondent wins a counterclaim against you, you must pay the counterclaim within 45 days after the decision unless you appeal to the Commission.
If you fail to pay the counterclaim and you do not appeal, the respondent can enforce the award in the U.S. District Court in your district. If you win your claim and a respondent wins a counterclaim against you, your award will be reduced by the amount of the counterclaim award or vice versa.
Federal court decisions involving commodity law and CFTC decisions in both reparations and enforcement cases are available on Lexis-Nexis and Westlaw and are published in the Commodity Futures Law Reporter (published by Commerce Clearing House). These resources are available in many libraries and most law libraries.
If you are representing yourself, you are not required to cite legal cases, but if you can provide the judge with references to similar cases, you may strengthen your claim.
Registration Information and Disciplinary History
Information about CFTC enforcement or reparations actions is available from CFTC staff in the Office of Proceedings.
Information about both registration status and disciplinary history for registrants is available from the National Futures Association.
Bankruptcy or Receivership
If the respondents are in bankruptcy or receivership, you should contact the respondents or their lawyers for the names of the bankruptcy trustee or receiver to determine if you may file a claim.
Arbitration and Alternate Dispute Resolution
Information about arbitration to resolve commodity futures disputes is available from
Futures exchanges offer arbitration programs for disputes involving one or more exchange members.
Filing Civil Cases in U.S. District Court
Information is available from the Clerk of any U.S. District Court. Court information is available from libraries or on the Internet.
Many parties represent themselves; in other words, act pro se. You may not need an attorney if:
Remember that when you act pro se, you must gather evidence, comply with all rules and deadlines, and make your own legal arguments. Neither the judge nor CFTC staff will litigate or investigate the case on behalf of any party, whether or not that party is acting pro se.
If you have a complex case or anticipate difficulty in following the reparations rules, you may wish to hire an attorney to represent you. You can ask a local bar association for a referral to an attorney.