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CFTC Gives Guidance on Cooperation

Client Briefing

29 January 2017

On January 19, 2017, the U.S. Commodity Futures Trading Commission issued an Enforcement Advisory describing the factors that will be considered to evaluate the cooperation provided by companies that are the subject of CFTC investigations and / or enforcement actions. The CFTC can, in its discretion, reduce penalties to be imposed for violations based upon its determination of a company's level of cooperation. The Cooperation Advisory emphasizes a company's proactive steps in response to an investigation, including encouraging personnel to cooperate with CFTC, identifying potential wrongdoers from within the company and from other organizations, devoting staff and resources to an investigation, and providing both documents and helpful explanations of market operations to CFTC. The Cooperation Advisory also suggests that CFTC will no longer treat joint-defense agreements as a negative factor per se, but will be critical of gratuitous sharing of potentially relevant documents. Finally, it suggests that CFTC may now be more interested in company policies, controls and culture, including both those that existed at the time of any misconduct, and those that the company enacts remedially.

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CFTC Gives Guidance on Cooperation

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