On October 20, 2022, the Commodity Futures Trading Commission (“CFTC”) released its enforcement results
for Fiscal Year (“FY”) 2022, reporting that it had filed 82 enforcement actions. Eighteen of the actions brought in FY 2022 involved cryptocurrency or other digital assets, an area which has seen progressively increasing scrutiny from the CFTC and other enforcement agencies. The CFTC also reported that it obtained orders collectively imposing over $2.5 billion in fines in that period.
In its announcement, the CFTC again highlighted enforcement actions brought this year involving significant fines that have been previously reported. These include the so-called “off-channel” resolutions
reached by the CFTC with 12 major financial institutions for alleged violations of recordkeeping and supervisory obligations of their registered futures commission merchant and swap dealer affiliates through use of text messages and other off-channel communication platforms; and the settlement reached with Glencore International A.G., Glencore Ltd., and Chemoil Corporation (collectively, “Glencore”), the single largest civil monetary penalty and single largest disgorgement ever achieved by the CFTC, involving allegations of manipulating, or attempting to manipulate, four U.S.-based S&P Global Platts physical oil benchmarks and related derivative instruments. These CFTC resolutions were previously announced
in conjunction with resolutions obtained by other U.S. and foreign regulators, including the Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”).
Finally, the CFTC announced that it continued to expand its whistleblower program, issuing a record-breaking award of $200 million to an individual whistleblower—the largest ever award issued by either the CFTC or the Securities and Exchange Commission under the Dodd-Frank Act—and issuing more than $3 billion in sanctions in whistleblower-related enforcement actions.
The CFTC’s volume of enforcement activity in FY 2022 was vigorous by any measure and the agency indicated that it expects to continue these efforts into FY 2023. Those companies regulated by the CFTC can expect to see these enforcement efforts, especially in situations where the conduct in question has already come to the attention of the DOJ, SEC, or another regulator.