The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

Washington, D.C. — Commodity Futures Trading Commission Chairman Heath P. Tarbert today announced the CFTC will hold open meetings on July 22 and 23. The meetings will be held via conference call in accordance with the agency’s implementation of social distancing due to the COVID-19 (coronavirus) pandemic.

At the meeting on July 22 at 1:00 p.m., the Commission will consider the following:

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

The CFTC’s mission is to promote the integrity, resilience, and vibrancy of the U.S. derivatives markets through sound regulation.  The Commission pursues that mission through rulemaking.  The Commission may promulgate, amend, or repeal rules based on statutory directives, discretionary objectives, or petitions for rulemaking submitted by the public.[1]   The Commission’s authority to issue rules derives part from the Commodity Exchange Act and the Dodd-Frank Act. 

The Administrative Procedure Act (APA) sets forth the process for an agency to promulgate, amend, or repeal a rule.  The Commission follows the APA rulemaking process, which generally requires the Commission to provide notice to the public and seek comment before promulgating, amending, or repealing a rule.  As a result, in the normal course, the Commission proposes a rule in the form of a Notice of Proposed Rulemaking (NPRM), publishes it in the Federal...

In May 2020, the Commodity Futures Trading Commission's Division of Enforcement issued updated guidance—the first since 1994—outlining factors it will consider in recommending civil monetary penalties in enforcement actions. To help FIA members understand the significance of this guidance, Allison Lurton, FIA's general counsel, conducted a live interview with James McDonald, the CFTC's head of enforcement, and asked him to describe the purpose for the guidance and its impact on market participants. The following article is excerpted and lightly edited from that interview.

The full recording of this interview with the CFTC's James McDonald is available on the FIA website here. 

Q: Before we dive into this current guidance update, I note that you also have issued guidance on other enforcement priorities, such as the guidance on self-reporting and the guidance on the Foreign Corrupt Practices Act. Are all of these part of a...

The mission of the Commodity Futures Trading Commission’s (“CFTC”) is to promote the integrity, resilience, and vibrancy of the U.S. derivatives markets through sound regulation. As part of this mission, the CFTC regulates a variety of individuals and organizations. These include futures commission merchants, commodity pool operators, commodity trading advisors, retail foreign exchange dealers, introducing brokers, designated contract markets, foreign boards of trade, swap dealers, and other entities and individuals. To promote market integrity, the CFTC surveils the derivatives markets for various abuses, and holds wrongdoers accountable.

Increasingly, fraudsters use a variety of social engineering, fake profiling, and manipulative techniques to ensnare their victims. Fraud tactics regularly employ common keywords and phrases. With this information, there is an opportunity to utilize modern technology as a tool to augment traditional, manual efforts and to identify bad...

Washington, D.C. — The Commodity Futures Trading Commission today announced that LabCFTC will present Empower Innovation 2020, a series of interactive virtual events throughout the fall. The three-part series will facilitate a dialogue among innovators, regulators, market participants, and the public around cutting-edge fintech innovation. In light of the COVID-19 (coronavirus) pandemic, the Empower Innovation 2020 series will be held in lieu of the 2020 Fintech Forward conference.

LabCFTC will also announce the winner of Project Streetlamp, the competition LabCFTC launched in April under the Science Prize Competition Act, at the November Empower Innovation 2020 event. [See CFTC Press Release No. 8154-20]

“Encouraging innovation and enhancing the regulatory experience for market participants is essential to what we do at the CFTC,” said CFTC Chairman Heath P. Tarbert. “As our markets adapt in the wake of COVID-19, so too must we innovate and adapt. I am...

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

Washington, D.C. — The Commodity Futures Trading Commission today announced it has filed a civil enforcement action in the Eastern District of California charging a number of individuals and entities with operating a $14.5 million binary options and retail foreign currency (forex) Ponzi scheme. Charged in the complaint are California-based defendants John D. Black and his affiliated entities Financial Tree (d/b/a Financial Tree Trust), Financial Solution Group (d/b/a Financial Solution Group Trust), and New Money Advisors, LLC, and his associates Christopher Mancuso and Joseph Tufo. The complaint also charges Colorado-based defendants John P. Glenn and his law firm, The Law Firm of John Glenn, P.C. In addition, the complaint names seven relief defendants who received funds from the scheme to which they have no lawful entitlement.

According to the complaint, the defendants misappropriated over $11 million to make payments to certain pool participants in a style consistent...

Washington, D.C. — The Commodity Futures Trading Commission today announced the finalization of the agency’s 2020-2024 Strategic Plan. The plan was unanimously approved by the Commission in May and was subject to a 30-day comment period that ended in June.

“This is a bipartisan, consensus plan that can stand the test of time,” said CFTC Chairman Heath P. Tarbert. “I am proud of the hard work that went into developing the plan and the unanimous support it ultimately received. It will guide the last of the CFTC’s unfinished business to completion and better position the agency to tackle the unwritten future.”

The strategic plan calls on the CFTC to focus its work on five strategic goals, each with clearly defined objectives:

Washington, D.C. — The Commodity Futures Trading Commission today announced it has filed a complaint in the U.S. District Court for the Western District of Texas against James Frederick Walsh of Boca Raton, Florida, charging him with fraudulent solicitation and failure to register with the CFTC. Walsh’s fraudulent solicitations include falsely claiming to generate increased profits as a result of the COVID-19 pandemic. This is the first enforcement action brought by the CFTC alleging misconduct tied directly to the pandemic. The CFTC has also brought additional cases against entities and individuals whose frauds were ongoing during the pandemic. [See CFTC Press Release Nos. 8180-20, 8179-20, 8164-20].

“We continue to actively monitor our markets to seek out bad actors using the COVID-19 crisis as a basis for investment scams,” said CFTC Director of Enforcement James McDonald. “There is never an appropriate time to prey on innocent people’s fears, and we will...

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

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Before working with any person or firm to trade in commodity futures, commodity pools, options, forex, or other derivatives, verify that the entity is properly registered with the CFTC.  The Commodity Exchange Act requires certain firms and individuals to be registered with the CFTC.  Registration and examination of intermediaries is conducted on behalf of the CFTC by the National Futures Association (NFA) under the supervision of the CFTC.

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

Making decisions to trade or invest by yourself, especially if you are socially isolated, could make you more susceptible to fraud, research shows. If you’re solicited to buy or trade assets such as gold, silver, or digital assets, taking a little time to talk the idea over with someone you know and trust could save you significant losses down the road.

A 2019 joint study by the FINRA Investor Education Foundation, Better Business Bureau, and Stanford Center for Longevity found that respondents targeted by fraud were more likely to lose money if they did not have anyone with whom they could discuss the offers. In addition, those who engaged with the fraudsters “expressed significantly higher feelings of loneliness.”

According to previously unreleased data, the study’s authors said, nearly twice as many victims (41 percent) agreed with the statement “I didn’t have anyone to discuss (the solicitation) with” as non-victims (24 percent). Widowed (47 percent) and...

Washington, D.C. — The Commodity Futures Trading Commission today announced the filing of a civil enforcement action in the U.S. District Court for the Northern District of Illinois against Long Leaf Trading Group, Inc., its principals James A. Donelson of Aurora, Illinois, and Timothy M. Evans of Tulum, Mexico, and former Long Leaf associated persons Jeremey S. Ruth of Austin, Texas, and Andrew D. Nelson of Elmhurst, Illinois. The defendants are charged with defrauding customers in connection with options on futures transactions.  Some of the defendants are also charged with registration and disclosure violations. The CFTC also issued two orders filing and simultaneously settling charges against two additional former associated persons of Long Leaf, Scott J. Gecas, of Tinley Park, Illinois, and James E. Leeney, of Chicago, Illinois for their participation in the firm’s fraud scheme.

“The CFTC is committed to stamping out fraud in its markets, particularly with...

The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know.

Definitions are not intended to state or suggest the views of the Commission concerning the legal significance or meaning of any word or term and no definition is intended to state or suggest the Commission’s views concerning any trading strategy or economic theory.

List of Foreign Entities That Have Been Identified as Acting in a Capacity That Appears to Require Registration but Are Not Appropriately Registered With the Commission

The CFTC frequently receives investigative leads and questions from the public about foreign entities that solicit and/or accept funds from U.S. residents at a retail level. For example these leads and questions can relate to, among other things, foreign entities that engage in foreign currency (“Forex”) in a capacity similar to Retail Foreign Exchange Dealers (“RFEDs”), Introducing Brokers, Commodity Trading Advisors or Commodity Pool Operators and binary options. Many of these foreign entities are acting in a capacity that requires them to be registered with the CFTC.

If a foreign entity is registered with the commission, then it is subject to CFTC regulations and oversight that apply to registrants. Generally, foreign entities that solicit you to trade are required to...

The mission of the Commodity Futures Trading Commission’s (“CFTC”) is to promote the integrity, resilience, and vibrancy of the U.S. derivatives markets through sound regulation. As part of this mission, the CFTC regulates a variety of individuals and organizations. These include futures commission merchants, commodity pool operators, commodity trading advisors, retail foreign exchange dealers, introducing brokers, designated contract markets, foreign boards of trade, swap dealers, and other entities and individuals. To promote market integrity, the CFTC surveils the derivatives markets for various abuses, and holds wrongdoers accountable.

Increasingly, fraudsters use a variety of social engineering, fake profiling, and manipulative techniques to ensnare their victims. Fraud tactics regularly employ common keywords and phrases. With this information, there is an opportunity to utilize modern technology as a tool to augment traditional, manual efforts and to identify bad...

Washington, D.C. — The Commodity Futures Trading Commission at its open meeting today approved two final rules, withdrew a previously proposed rule and supplemental proposal, and advanced two proposed rules on the following matters:

Proposed Rule: Electronic Trading Risk Principles

On a 4-1 vote, the Commission approved a proposal to amend Part 38 of CFTC regulations to address the risk of electronic trading causing a market disruption on a designated contract market’s (DCM) trading platform. The proposed regulations include three principles applicable to DCMs, and concern (i) the implementation of exchange rules applicable to market participants to prevent, detect, and mitigate market disruptions and system anomalies associated with electronic trading; (ii) the implementation of exchange-based pre-trade risk controls for all electronic orders; and (iii) the prompt notification of the Commission by DCMs of any significant disruptions to their electronic trading...

The Commodity Futures Trading Commission is providing this dedicated website to highlight the Commission’s actions related to COVID-19. During this challenging period, the CFTC remains squarely focused on its mission to promote the integrity, resilience, and vibrancy of the U.S. derivatives markets through sound regulation.