CFTC Commissioners' Speeches

On Oct. 11, CFTC commissioners Giancarlo and Behnam testimonies.

  • Chairman Giancarlo gave testimony on the CFTC-regulated derivatives markets.
  • Importance of the CFTC
  • Derivatives serve the needs of society to help moderate price, supply, risks.
  • When used properly, they are tools for efficient risk transfer and mitigation.
  • Derivatives markets are not just useful for agricultural producers
  • They impact the price, availability of energy; interest rates; used to manage risk.
  • Enforcement
  • CFTC has strengthened rules and procedures to better protect whistleblowers.
  • Has brought enforcement cases and other resolutions, harnessing more resources.
  • Has brought significant spoofing cases; filed largest precious metals fraud case.
  • It has also prosecuted fraud in virtual currency markets, failure to supervise actions.
  • Plus position limits violations, and record-keeping, reporting obligation violations.
  • LabCFTC
  • LabCFTC is designed to make the CFTC more accessible to FinTech innovators.
  • It serves as platform to inform the CFTC's understanding of emerging technologies.
  • Encourages market-enhancing financial technology creation, no immediate regulation.
  • LabCFTC has held over 100 meetings with market participants and FinTech innovators.
  • The range from established financial service firms to start-up companies.
  • Cybersecurity
  • Cybersecurity is undoubtedly the most important single issue facing our markets today.
  • The CFTC recently worked with the Department of Homeland Security on important drill.
  • Disaster-recovery exercise based on simulated cyber-attack on US derivative markets.
  • Project KISS
  • Project KISS stands for “Keep It Simple Stupid.” It is an agency-wide review of CFTC rules.
  • To try to keep them simpler, less burdensome, and less costly. Public invited to comment.
  • Swaps Rules and Data
  • Giancarlo said he's a supporter of swaps reforms of the G20 and Title VII of Dodd-Frank Act.
  • But he continues to think CFTC’s current approach is highly over-engineered.
  • And disproportionately modeled on US futures market, plus biased against tech innovation.
  • He noted CFTC is committed to success in global reform efforts with swaps data reporting.
  • Need is for global swaps data harmonization, improving current processes for reporting.
  • Unfinished Business
  • CFTC must resolve the de Minimis exception and a position limits rule.
  • Level of the de Minimis threshold is important issue, requires analysis of complete data.
  • With position limits, rulemaking been underway for some time, opinions must be reconciled.
  • Commissioner Benham Weighs In
  • Additional delays of the swap dealer de minimis threshold only serves to prolong uncertainty.
  • Commission should take further action now or let the current rule take effect, he said.

Regulators CFTC
Entity Types FCM; OTC
Reference Sp, 10/11/2017
Functions Compliance; Operations; Product; Reporting; Technology
Countries United States of America
Products Commodities; Derivatives; Deposits
Regions Am
Rule Type Concept
Rule Date 10/11/2017
Effective Date 10/11/2017
Rule Id 35457
Linked to N/A
Report Issue 10/15/2017
Report Section US Derivatives

Last substantive update on 10/11/2017