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.
- 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 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 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.
||Compliance; Operations; Product; Reporting; Technology
||United States of America
||Commodities; Derivatives; Deposits
Last substantive update on 10/11/2017