Purpose Statement: Commission-Wide Data Infrastructure
The Commission’s over-arching information technology (IT) strategy is to increase the integration of IT into the Commission operating model, which is described in Goal Five of the Strategic Plan. This strategy has become increasingly more important and complex as the Commission’s regulatory scope has expanded faster than its resources. In order to do this rapidly with the most practical investment, the Commission’s approach is to manage data as an enterprise asset, promote and adopt industry data standards, give priority to services that provide the greatest mission benefit, architect services using small components that can be assembled and reassembled with agility, and deliver solutions in short, iterative phases. The first area of focus must be on data understanding and ingestion—particularly because CFTC has a unique imperative to aggregate various types of data from multiple industry sources across multiple markets, much of which is new to the Commission staff. Receipt and analysis of the first wave of registrant reporting will give Commission staff insight into the markets and business process, which can be used to firm-up requirements and designs for internal surveillance systems. Likewise, the same business analytics tools used for data understanding and ad hoc mining of mature datasets will also be used to automate transparency reporting.
This approach is supported by several strategic objectives:
- Provide accurate, centralized source and reference data;
- Protect proprietary industry, individual, and sensitive government information;
- Connect industry straight-thru processing to automated internal processes;
- Exploit publicly available and industry-provided information and facilities;
- Leverage data as an enterprise asset, avoid redundant or "siloed" data collections;
- Develop software components for enterprise use;
- Consider total cost of ownership and use or buy or build to achieve best value with acceptable risk; and
- Provide a secure and stable technology infrastructure to receive, ingest, store, mine, and analyze data, including acquisition of commercial, off-the-shelf products when possible.
From an implementation planning perspective, the Commission examines existing software technology prior to building software solutions. The Commission explores open technology solutions that allow for the integration of software and data between software products and custom-built systems. Similarly, the Commission considers whether systems are suitable for cloud-based hosting. Security, privacy, and integration are strategic considerations of hosted solutions. It is essential that the Commission is able to aggregate data and integrate software to provide support for a wide variety of analytical functions. As a result, the Commission utilizes a combination of commercial, off-the-shelf products, and custom-built software and has adopted cloud-based solutions wherever practical.
The Commission is adopting a service-oriented approach to building technology systems. The objective is to design and build technology components once, but leverage those components throughout the Commission. Similarly, efforts are focused on building a "straight-thru processing" capability as a core requirement of its implementation efforts – collecting information directly from the industry source and automating the ingestion into CFTC internal systems. This approach will reduce the amount of manual data entry required of Commission staff, improve data quality, and increase information availability. For large volumes of data, data will be received and processed based on industry data standards and automatically loaded into CFTC systems. For low volume and forms-based data, CFTC will be creating a web-based portal to enable data collection and "straight-thru processing" into CFTC systems.
As emphasized throughout the Strategic Plan, transparency is a key component of Commission surveillance, enforcement, and policy-making strategy. The Commission uses transparency reporting to involve the public and industry in the market oversight process, significantly increasing the effect of Commission activity. The CFTC.gov website provides that transparency. Hundreds of information content changes are updated to the CFTC.gov website each day. The Commission is committed to providing excellent external communications through its public website and other social network outreach initiatives. The CFTC.gov website communicates the Commission's mission, actions, and activities to all stakeholders, including the Dodd-Frank Act activities, pending industry filings, solicitations of comments on those filings and proposed rules, links to all open comment periods, and highlights on the home page that contains deadlines for comment periods for Federal Register releases. The CFTC.gov website also includes webcasts of all open meetings and archives of previous webcasts, as well as contact information for futures market customer protection; Equal Employment Opportunity; Freedom of Information Act compliance; employment and information quality; fraud, waste, and abuse; procurement opportunities; NFA registration; small businesses; and website accessibility and technical issues. The CFTC.gov website also disseminates market reports to provide information to industry participants and the public about the futures, options, and swaps markets. The Commission promotes communication and transparency through its social media presence on Facebook, Flickr, Twitter, and YouTube.
Data Management is integral to all new program initiatives and integrating swaps oversight into existing program initiatives. The Office of Data and Technology (ODT) will implement CFTC enterprise technology solutions that enable the sharing and reuse of data for cross-divisional purposes. Policy, procedures, and resources established in FY 2012 to govern, manage, and access data using a Commission-wide information architecture and framework will allow ODT to coordinate the definition, collection, loading, and availability of data from external parties (e.g., DCMs, swap data repositories) for use in automated systems and independently by CFTC analysts.
ODT will continue to improve information technology and management capabilities in the areas of data management to support analytics, statistical processing, and market research. CFTC will provide quality data to empower its staff to perform the complex data analyses needed to regulate the futures market. To ensure that CFTC staff has access to quality data, ODT will continue to lead efforts to provide a consolidated data set that is the single source of reference for its operational production systems.
Prior to the Dodd-Frank Act, the Commission processed over 5 billion records per month into market surveillance, financial and risk surveillance, and business analytics applications. The Commission anticipates a tripling in the number of exchanges and/or trading platforms under its purview between FY 2011 and FY 2013, as a result of the Dodd-Frank Act, and many new significant data streams will be added. These streams will continue to increase in variety, complexity, and volume and will come from an increasing number of participants. CFTC will support this expanding data ingest using strategies that limit the amount of manual intervention required by both industry and Commission staff, and at the same time ingesting only data that is clean and reliable. New datasets ingested include:
- Large trader swaps position data;
- Designated clearing organization margin, position, and cash flow information;
- Form 40 and 102 swaps participant registration data streams; and
- Order message data.
The Commission undertook a reorganization in FY 2012 to better integrate the technical and mission drivers for IT investment. The new data management program will manage these data streams effectively, facilitate using the streams in new and innovative ways to increase the efficiency and effectiveness of Commission oversight, and help to identify gaps that might reduce the effectiveness of the Commission.
Following technology best practices, the Commission seeks to build software solutions using an iterative, rapid application development approach. IT development, integration, and enhancements support critical business requirements through delivery of technological capability represented by quick, secure information access, analytical capabilities, and successful business process automation. To effectively accomplish its mission, the CFTC adapts to frequent and innovative changes in the derivatives markets, increasing use of technology and growing market complexity. The Commission must invest in IT to timely track market activity, understand the markets, and provide effective oversight. Prior year investments in infrastructure and system capabilities must be leveraged and built upon to provide services that multiply the effectiveness of staff, accomplishing integration between futures and swaps data and increased integration of CFTC systems and processes for monitoring registered entities, market and financial risk, market integrity, and trade practice as well as systems and processes for enforcement and economic analysis.
Maintaining a blended workforce that optimizes the use of contract services through effective management is a key component of the Commission IT strategy. As the size and complexity of the Commission’s investment in IT increases, it is essential to maintain a cadre of FTE with industry, technical, and contract oversight expertise who ensure that IT investments are managed effectively and provides reliable business continuity support, ultimately lowering IT ownership costs and reducing the risk inherent in large IT projects.