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Home>UPDATE: Wall Street's newest regulator is itself

UPDATE: Wall Street's newest regulator is itself

UPDATE: Wall Street's newest regulator is itself

09/25/2017

By Steve Goldstein, MarketWatch

CFTC speech is, for the most part, raising a white flag

The Commodity Futures Trading Commission has found a solution to its problem of chronic underfunding -- it will let the industry do the investigating.

That's not an overstatement. The head of the CFTC's enforcement division will lay that framework out in a speech on Monday night, according to a draft received by the New York Times (https://www.nytimes.com/2017/09/24/business/cftc-commodity-futures-trading-commission.html).

The thrust is that companies that self-report will receive a discount on their penalty of about 75%, and in what are called rare cases in the report, relief from penalties altogether.

Discounts aren't new. All regulators, including the CFTC and the Securities and Exchange Commission, offer discounts for cooperation.

When a Swedish telecommunications company, Telia, settled with the SEC and Justice Department last week (http://www.marketwatch.com/story/sec-doj-fine-swedish-telecom-965-million-for-bribing-uzbekistan-officials-2017-09-21) over alleged bribes in Uzbekistan, the company reported that, because of its cooperation, it received a 25% discount from what U.S. sentencing guidelines called for.

Self-regulation also isn't new. The Financial Industry Regulatory Authority and the National Futures Association each regulate, and fine, companies in the securities and futures businesses.

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