Commodity Futures Trading Commission Cftc

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Commodity Futures Trading Commission (CFTC) is a US-based agency responsible to regulate the derivatives markets, which includes options, swaps, and futures contracts.
CFTC plays an important role in regulating financial markets.
The market participants/traders may become a victim of fraud and believe in our capital markets can be ended without such regulators and regulations.
In the past, futures contracts were commonly traded in the context of agricultural commodities. That is one of the reasons the CEA was part of the United States Department of Agriculture (USDA). However, the futures industry became increasingly complex and now presents a wide variety of contracts.
It can make capital markets ineffective to allocate financial resources in an efficient way for the most deserving means of production and productive economic activities to the detriment of investors, consumers and society.
It was established in 1974 as an independent organization that took over the responsibilities of its former regulatory agency, the Commodity Exchange Authority (CEA).
In the past, futures contracts were usually traded in the context of agricultural commodities. That's because CEA was part of the United States Department of Agriculture (USDA). However, the industry of the future became increasingly complex and now offers a variety of contracts.

Commodity Futures Trading Commission Cftc

The CFTC’s mission statement:

“The mission of the Commodity Futures Trading Commission is to promote the integrity, resilience, and vibrancy of the U.S. derivatives markets through sound regulation”.

The CFTC’s vision statement:

“To be the global standard for sound derivatives regulation”.
The CFTC shares common goals with the Securities Exchange Commission (SEC), although focused on different industry sectors.
Both agencies are actively taking part to avoid the market manipulation and fraudulent activities, including Ponzi and pyramid schemes.
As part of their strategy, the so-called whistleblower programs reward citizens that provide valuable information about fraudulent activities.
After the Great Financial Crisis (“GFC”) of 2008, then-President Barack Obama approved the Dodd-Frank Wall Street Reform and Consumer Protection Act, which granted the CFTC and SEC increased authority, especially over large derivatives traders.

CFTC Organization

Commodity Futures Trading Commission Cftc

The CFTC organization consists of:

The Commissioners
The offices of the Chairman
The agency’s operating units

The Commission consists of five commissioners appointed by the President, with the advice and consent of the Senate, to serve staggered five-year terms.
The President, with the consent of the Senate, designates one of the commissioners to serve as Chairman.
No more than three commissioners at any one time may be from the same political party.

Divisions

Clearing and Risk (DCR)
The Division of Clearing and Risk (DCR) oversees derivatives clearing organizations (DCOs) and other market participants in the clearing process.
Enforcement (DOE)
The Division of Enforcement investigates and prosecutes alleged violations of the Commodity Exchange Act and Commission regulations. Potential violations include fraud, manipulation, and other commodity derivatives and exchange-related abuses that threaten market integrity, market participants, and the general public.
Market Oversight (DMO)
The Division of Market Oversight (DMO) sees open, transparent, fair, competitive, and secure markets through oversight of derivatives platforms and swap data repositories.
Swap Dealer and Intermediary Oversight (DSIO)
The Division of Swap Dealer and Intermediary Oversight (DSIO) basically checks the derivatives market intermediaries, including commodity pool operators, commodity trading advisors, futures commission merchants, introducing brokers, major swap participants, retail foreign exchange dealers, and swap dealers, as well as designated self-regulatory organizations.

Offices

Office of the Chief Economist (OCE)
The Office of the Chief Economist provides economic support and advice to the Commission, conducts research on policy issues facing the Commission, and educates and trains Commission staff.
The OCE plays a key role to implement new financial market regulations by providing economic expertise and cost-benefit considerations underlying those regulations.
Office of Data and Technology (ODT)
The Office of Data and Technology provides technology and data management support for market and financial oversight, surveillance, enforcement, legal support, and public transparency activities. ODT also provides general network, communication, storage, computing, and information management infrastructure and services.
Office of the Executive Director (OED)
The Executive Director ensures that the Commission adapts to the changing markets it is charged to regulate, directs the allocation of CFTC resources, develops and implements a regulatory policy and ensures that program performance is measured and tracked throughout the commission.
Office of the General Counsel (OGC)
The office of the General Counsel offers legal services and supports Commission and all of its programs including representation of the Commission in appellate, bankruptcy and other litigation; assisting in the performance of adjudicatory functions; providing legal advice and support for Commission programs; drafting and assisting in the preparation of Commission regulations; interpreting the CEA; and advising on legislative, regulatory, and operational issues.
Office of the Inspector General (OIG)
The Office of the Inspector General is an independent organizational unit at the CFTC. Its mission is to detect waste, fraud, and abuse and to promote integrity, economy, efficiency, and effectiveness in the CFTC’s programs and operations.
As such it has the ability to review all of the Commission’s programs, activities, and records. In accordance with the Inspector General Act of 1978, the OIG issues semiannual reports detailing its activities, findings, and recommendations.
Office of International Affairs (OIA)
The Office of International Affairs advises the Commission regarding international regulatory initiatives; provides guidance regarding international issues raised in Commission matters; represents the Commission in international for a such as the International Organization of Securities Commissions (IOSCO), OTC Derivatives Working Group (ODWG), and OTC Derivatives Regulators Group (ODRG); coordinates Commission policy as it relates to policies and initiatives of major foreign jurisdictions, the G20, Financial Stability Board (FSB), and U.S. Treasury Department; negotiates cooperative arrangements and responds to inquires related to supervisory cooperation or information sharing; and provides technical assistance to foreign market authorities, including advice, training, and an annual meeting and symposium.
Office of Legislative and Intergovernmental Affairs (OLIA)
The Office of Legislative and Intergovernmental Affairs (OLIA) is the chief advisor to the CFTC Chairman on matters before the U.S. Congress and serves as the Commission’s official liaison with Members of Congress, federal agencies, and the Administration.
Office of Minority and Women Inclusion (OMWI)
The Office of Minority and Women Inclusion leads the CFTC’s civil rights, equal employment opportunity, diversity, and inclusion programs.
Office of Public Affairs (OPA)
The Office of Public Affairs is the primary public office of the Commission providing honest, timely and useful information on all communication platforms in order to serve and facilitate internal and external stakeholders in all sectors to fulfill the Commission's mission. Could be OPA actively conducts outreach and creates messages designed to raise public awareness about the CFTC brand.
Whistleblower Office (WBO)
The CFTC's Whistleblower program provides financial incentives to individuals who report potential violations of the Commodity Exchange Act that could lead to successful enforcement action, as well as sharing information with the CFTC or Privacy, Confidentiality, and Response to Retaliation for City Blowers

CFTC Committees

The CFTC’s Advisory Committees were created to provide input and make recommendations to the Commission on a variety of regulatory and market issues that affect the integrity and competitiveness of U.S. markets.
The committees facilitate communication between the Commission and U.S. futures markets, trading firms, market participants, and end-users.
The committees currently include:

Agricultural Advisory Committee
Energy and Environmental Markets Advisory Committee
Global Markets Advisory Committee
Market Risk Advisory Committee
Technology Advisory Committee
CFTC-SEC Joint Advisory Committee

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