The U.S. Commodity Futures Trading Commission collected $1.3 billion in restitution, disgorgement, penalties and fees in 2019. In its annual enforcement and compliance report, the regulator revealed that the number of enforcement actions has reduced, but the fees and penalties have shot up 39%.
The report revealed that the CFTC had filed 69 actions in the financial year 2019, down from 83 the year prior. However, it’s still slightly above the five year average which stands at 67.5.
Despite the number of enforcement actions going down, the regulator collected $1.3 billion in fees, up from the $947,000 collected in FY2018. This is the fourth-highest figure ever registered by the watchdog. This total includes all monetary relief ordered in CFTC actions including disgorgement, restitution and civil monetary penalties.
The report revealed that the market is still rife with misconduct, with market manipulation and commodities fraud accounting for 60% of all the enforcement actions. Other actions against which the regulator acted include wash trading, swap data reporting, misappropriation of confidential information and violation of prior orders.
The high number of market misconduct enforcement actions is a reflection of the regulator’s new-found zeal against these actions. In 2018, the CFTC established a spoofing task force. James McDonald, the CFTC director of enforcement remarked, “The breadth and significance of the enforcement activity in FY 2019 is reflected in the fact that the filed cases involved some of the most significant commodities fraud, manipulation, and spoofing cases in the history of the agency.”
The report also revealed that in FY2019, which started on October 1 2018 and ended on September 30 2019, the CFTC filed more actions in parallel with criminal authorities than in any prior year.
This financial year was also marked by the transitioning of power, with Heath Tarbert taking over in July this year as the head of the agency. Tarbert has been quite stringent and he’s not about to change any time soon.
He commented, “Tough, but fair – that’s been our response to those who break the rules. A strong enforcement program is about preserving market integrity, protecting consumers, and deterring misconduct from taking place.”
The report highlighted a few of the crypto cases that the CFTC has taken action on. They include the regulator’s pursue of Control Finance Limited, a U.K.-based company that it charged with fraudulent conduct.
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