In Regulatory Wrap for the week to February 28, Kathryn Fallah breaks down the CFTC’s new self-reporting matrix, which includes potential penalty reductions of up to 55%.
In this week’s Regulatory Wrap, we dissect the Commodity Futures Trading Commission’s (CFTC) bid to incentivize firms that self-report and cooperate by introducing a mitigation matrix offering up to 55% off financial penalties.
1. Per the CFTC’s new guidelines, if firms voluntarily report misconduct, fully cooperate with investigations, and work to address issues, they could receive discounts on penalties
2. There are three rankings that firms can receive based on reporting efforts: no self-report, satisfactory self-report, and exemplary self-report
3. Additionally, there are four rankings that firms can receive based on cooperation and remediation efforts: no cooperation, satisfactory cooperation, excellent cooperation, and exemplary cooperation
4. Firms will only receive full credit off penalties if their disclosure is voluntary, timely, complete, and made directly to the CFTC
5. Acting CFTC Chair Caroline Pham said the new guidelines are offering firms meaningful incentives to come forward and get cases resolved faster with reasonable penalties
This week’s episode is brought to you by our Content Writer, Kathryn Fallah.
As the CFTC pushes to encourage self-reporting and cooperation that targets misconduct more effectively, it’s important that firms work alongside regulators to maintain compliance by retaining full oversight of communications.
