Fraud

CFTC gets tough on fraud

The U.S. Commodity Futures Trading Commission is cracking down on fraud. The agency announced today that its enforcement program filed 57 actions in fiscal year 2010 - 14% more than in FY 2009 and 42% more than in FY 2008.

The actions involve allegations of manipulation, fraud, abuse and other violations of the Commodity Exchange Act, and yielded more than $186 million in civil monetary penalties, restitution and disgorgement.

Also, the Division of Enforcement opened 419 investigations in FY 2010 – an all-time high. It´s a 66% jump compared to the 251 investigations opened in FY 2009.

The most common type of enforcement action this year involved commodity pool fraud, with 15 cases. In second place was retail foreign currency, or forex, fraud, with 14 cases. The division also saw a sharp increase in the number of trade practice violations charged, from three in FY 2009 to 11 in FY 2010.

The CFTC typically brings its cases in cooperation with federal and state criminal and civil authorities. During FY 2010, more than 95% of CFTC’s major injunctive fraud cases involved related criminal investigations and, to date, more than 65% of those investigations have resulted in criminal indictments.

(Published by BLT - October 6, 2010)

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