by David Meister, Jocelyn E. Strauber, Jonathan Marcus, Theodore M. Kneller, Chad E. Silverman, and Daniel B. O’Connell

On October 29, 2020, the Commodity Futures Trading Commission (CFTC) Division of Enforcement (Division) issued a memorandum (Guidance) providing guidance for Division staff to follow when recommending the recognition of an entity’s self-reporting, cooperation or remediation in CFTC orders settling administrative enforcement proceedings.[1]

The Guidance, which appears to focus primarily on the language to be used in orders that settle enforcement actions, states that it is intended to further the CFTC’s recently stated strategic goal of providing clarity. It does not change the Division’s existing practices for evaluating self-reporting, cooperation or remediation, including for purposes of recommending penalty reductions, which were set forth in various advisories from January to September 2017 (Advisories).[2] The Guidance does not touch on, for example, the amount of credit (e.g., with respect to the amount of a penalty discount) the Division will recommend for self-reporting, cooperation or remediation. Instead, for the first time, the Division is formalizing when and how Division staff will recommend self-reporting, cooperation or remediation be “recognized” — i.e., described — in CFTC orders.

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