CFTC Issues $3 Million Monetary Penalty to ICE Futures for Reporting Issues

Multi-asset trading venue, ICE Futures, has been charged by the US financial watchdog, CFTC, for a number of breaches in

rp_Intercontinental_exchange_logo_ice-150x150.jpgThe CFTC reported that it has issued an Order against ICE Futures in relation to regulatory violations. The US-based trading venue will pay a $3 million fine for its consistent breach of guidelines. The move highlights the regulator’s firm stance on participants breaching key rulings.

Details issued by the watchdog state that on every reporting day during the period above, ICE submitted reports and data containing errors and omissions, with cumulative inaccuracies totaling in the thousands. The Order further finds that CFTC staff repeatedly notified ICE of the problems with its reports and data and requested that ICE take action to correct the mistakes, but that ICE continued to submit inaccurate reports and data.

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CFTC Director of Enforcement, Aitan Goelman, commented about the fine in a statement: “The CFTC cannot carry out its vital mission of protecting market participants and ensuring market integrity without correct and complete reporting by registrants, including DCMs. Today’s action makes clear that registrants who fail to meet their reporting obligations will be held accountable and that the CFTC takes a particularly dim view of reporting violations that continue over many months, especially after CFTC staff has repeatedly alerted the registrant in question to the problems in its reporting.”

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Duties of a DCM

As part of the CFCT’s guidelines firms are required to adhere to Part 16 of the CFTC Regulations, in the notification, the CFTC states : “A DCM is required to submit certain trading and market-related reports and data to the CFTC. In particular, a DCM is required to submit, for each business day, clearing member reports showing certain information for each future or option contract, including, among other things, the quantity of contracts currently open, the quantity of contracts bought and sold throughout the day, and the quantity of delivery notices.”

In addition, a DCM is also required to provide the CFTC with permanent record data relating to trading volume, open contracts, prices and certain critical dates, and transaction-level trade data and related order information for each futures or options contract.

Apart from a substantial monetary fine, the CFTC has asked the venue to create a new position where a responsible professional will ensure that correct data is submitted. Details of the case show that although the data was inaccurate, it was not published for traders to use incorrectly.

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