The Commodity Futures Trading Commission (CFTC) has taken significant action, issuing CFTC charges against BGC Derivative Markets, L.P. and GFI Swaps Exchange, LLC. These charges have resulted in fines totaling $1.3 million for failing to accurately report thousands of swap transactions. Such violations of CFTC regulations include breaches of SEF Core Principles and previous CFTC orders, underscoring the importance of compliance in the financial industry.
Understanding the CFTC Charges Against BGC and GFI
Both BGC Derivative Markets and GFI Swaps Exchange have acknowledged the facts outlined in the CFTC charges. As a consequence of these charges, they are mandated to cease and desist from further violations of swap reporting provisions. Additionally, they must submit compliance reports verified by their chief compliance officers and chief executive officers within one year. This requirement emphasizes the CFTC’s commitment to enforcing accountability for firms regarding their reporting practices.
Details of the CFTC Charges and Fines
As part of the CFTC charges, BGC Derivative Markets has been fined $750,000, while GFI Swaps Exchange will pay $550,000. The CFTC’s findings reveal that from December 2022 to April 2024, BGC encountered multiple reporting system issues that led to failures in accurately reporting and publishing data related to thousands of transactions. The issues highlighted in the CFTC’s report also included erroneous execution times for interest rate swaps submitted to a data repository, indicating significant weaknesses in BGC’s reporting systems and internal controls.
For comprehensive information on swap reporting requirements and compliance guidelines, visit the CFTC Swap Data Reporting page.
GFI Swaps Exchange and the CFTC’s Findings
Similarly, GFI Swaps Exchange failed to report accurate data from July 2017 to February 2024 due to system design flaws and insufficient reporting processes. Both firms demonstrated recurrent failures in ensuring the accuracy and completeness of swap transaction information.
Conclusion
The CFTC’s actions against BGC Derivative Markets and GFI Swaps Exchange underscore the importance of compliance with CFTC regulations and the need for robust internal controls in the financial industry. The Commodity Futures Trading Commission imposes fines on BGC Derivative Markets and GFI Swaps Exchange.
Explore More:
