Futures and Derivatives Law Report May 2022 | Volume 42 | Issue 5
B . DATA ANALYTICS AND COOPERATION WITH OTHER AGENCIES
Two of the greatest backbones in the CFTC ’ s enforcement program have become the data analytics program and cooperation with other agencies , which often work hand in hand . The CFTC relies on its data analytics program not only to uphold its main priority of ensuring market integrity , but to also assist other agencies in their efforts to identify and investigate conduct outside of the CFTC ’ s jurisdiction and the broader schemes behind disturbances in the market .
The CFTC receives troves of data from market participants and from the exchanges it oversees , and much of this data is made available to CFTC Enforcement ’ s surveillance staff , a group of experienced economic investigators . In the years since the financial crisis of 2008 to 2010 , the CFTC has expended significant resources to expand its capabilities to identify market disruptive behavior , such as manipulative trading schemes or spoofing , in the data it receives by investing in experienced personnel and developing proprietary software . Under its improved surveillance programs , the CFTC has the ability to obtain and review trading data in a near-real time manner and to examine trading across markets , market participants , and exchanges for disruptive and manipulative trading behavior . This depth and breadth of the information puts the agency at a significant advantage when conducting investigations .
The Division continued its trend in recent years of working in cooperation with other agencies to investigate and bring enforcement actions . Throughout the FY 2021 , several enforcement actions came with parallel criminal actions . 101 In addition to cooperation with criminal authorities , the Division also brought actions with the support of the SEC , the Federal Bureau of Investigations ( FBI ), the National Futures Association ( NFA ), and a number of state regulators . 102 CFTC Enforcement also has ongoing informationsharing agreements with many domestic and foreign authorities , and regularly receives assistance from foreign authorities in obtaining investigative material from foreign enforcement targets . The Division is certain to continue this trend of cooperation with other government agencies in future investigations and enforcement proceedings in 2022 and years to come .
V . CONCLUSION
The CFTC may be operating under a new Chairman and Commission but its enforcement program will continue to maintain a highly aggressive approach to market manipulation and disruptive trading behavior and any failures to fully comply with agency regulations . A new regulatory agenda will bring new and renewed enforcement focus in certain areas , such as digital assets and retail market participation , but will continue the Division ’ s intense scrutiny of the swaps market and its participants . This should pressure companies into ensuring that systems and controls in place are up to date and operating effectively . As the agency explores its new regulatory agenda and the possibility of the new regulations and legislation to expand its powers , market participants should proactively engage with the Commission to help shape the future of the commodity and derivatives markets , rather than sit back and have the future shaped for them .
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