November 22, 2017
CFTC Releases Annual Enforcement Results for Fiscal Year 2017
Agency Brought 49 Enforcement Actions and Obtained Orders Imposing $413 Million in Monetary Sanctions
CFTC Enforcement Activity Includes Significant Anti-Manipulation and Spoofing Enforcement Actions, Integration of Market Surveillance Unit, Additional Protection for Whistleblowers, and Enhanced Enforcement Tools
Washington, DC — The Commodity Futures Trading Commission (CFTC) today released the agency’s enforcement results for fiscal year (FY) 2017. In the fiscal year that ended September 30, 2017, the CFTC brought 49 enforcement-related actions, which included significant actions to root out manipulation and spoofing and to protect retail investors from fraud. The CFTC also pursued significant and complex litigation, including cases charging manipulation, spoofing, and unlawful use of customer funds. The CFTC obtained orders totaling $412,726,307 in restitution, disgorgement and penalties.
Specifically, in the fiscal year, the CFTC obtained $333,830,145 in civil monetary penalties and $78,896,162 million in restitution and disgorgement orders. Of the civil monetary penalties imposed, the CFTC collected and deposited at the U.S. Treasury more than $265 million.
In addition to its enforcement actions, the CFTC also implemented enhancements to increase the effectiveness and strength of the agency’s enforcement program. New rules and procedures were put in place to better protect whistleblowers and to further incentivize whistleblowers to come forward. The CFTC also realigned the market surveillance unit under the Division of Enforcement (DOE). Under the new alignment, the market surveillance unit conducts market analysis to confirm market integrity and identifies areas that may warrant enforcement inquiry. DOE also issued new cooperation advisories, which brings DOE’s cooperation program in line with other law enforcement agencies and will serve as a powerful enforcement tool going forward. Each of these developments will substantially strengthen the CFTC’s enforcement program.
“By enforcing the law and punishing wrongdoing in our markets, the CFTC’s enforcement program is vital to the CFTC’s mission to protect from harm both customers and the integrity of the derivatives markets,” said Chairman J. Christopher Giancarlo. “The work of the enforcement program, as reflected both in the significance of the actions brought and in the innovation and enhancements implemented, sends a message to the public that the CFTC will continue to vigorously enforce our laws, and that the agency’s enforcement staff is well equipped to respond to the new challenges presented by our evolving markets.”
“The success of the CFTC’s enforcement program during the past year is a tribute to the support of enforcement matters by the Commission and also to the professionalism and hard work of its enforcement staff,” said James McDonald, CFTC’s Director of Enforcement. “The CFTC brought significant enforcement actions, and has also laid the ground work for future success. The integration of the market surveillance unit into the Division of Enforcement, the strengthening of our whistleblower protections, and the development of our cooperation program will open new avenues through which we can identify misconduct, hold wrongdoers accountable, and deter future violations of the law.”
During FY 2017 the CFTC, through DOE, continued its successful benchmark rate anti-manipulation enforcement; brought significant actions to combat disruptive trading practices, including spoofing; and prosecuted retail fraud, including fraud involving virtual currency markets.
DOE also continued its robust cooperation with foreign regulators and law enforcement officials to combat the international components of many of its investigations. In addition, DOE continued and intensified its already close cooperation with the criminal authorities by referring appropriate matters to its criminal enforcement counterparts for consideration of criminal actions, including prison time for culpable individuals.
FY 2017 Enforcement Actions by Category
Manipulation, Attempted Manipulation, False Reporting, Disruptive Trading
Protection of Customer Funds, Supervision and Financial Integrity
Illegal Off-Exchange Contracts, Failure to Register
Other Trade Practice: Wash Trades, Fictitious Trades, Position Limits, Trading Ahead
Total Number of Enforcement Actions Brought
Notes: CFTC enforcement actions include 29 administrative cases, 17 civil injunctive cases and 3 non-prosecution agreements. The manipulation, attempted manipulation, false reporting, and disruptive trading actions included 8 actions involving spoofing (including 3 non-prosecution agreements), 2 actions involving attempted manipulation, 1 action involving both spoofing and attempted manipulation, and 1 action involving a manipulative or deceptive device. Some of the other enforcement actions involve multiple types of charges, but are listed above by the primary charges. For example: 3 retail fraud actions also involved illegal, off-exchange transactions; and 4 actions against registrants included a failure to supervise violation.
Last Updated: November 22, 2017