Washington, D.C. – On March 16, 2015, the U.S. Commodity Futures Trading Commission (CFTC) announced a settled enforcement action against ICE Futures U.S., Inc. (ICE) for submitting inaccurate and incomplete regulatory reports and data to the agency over a period of at least 20 months, spanning from October 2012 through May 2014.
According to the CFTC’s order, ICE repeatedly submitted flawed reports containing errors and omissions, with cumulative inaccuracies reaching the thousands. CFTC staff had repeatedly alerted ICE to these issues and requested corrective action, but the company continued to provide inaccurate data.
The settlement requires ICE to pay a $3 million civil monetary penalty and undertake measures to improve its regulatory reporting processes. CFTC Director of Enforcement, Aitan Goelman, emphasized the importance of accurate reporting from registrants, stating that the CFTC “cannot carry out its vital mission” without it and that prolonged reporting violations, especially after warnings, would be met with accountability.
The CFTC regulations mandate that designated contract markets (DCMs) like ICE submit daily reports detailing trading and market-related information, including open contracts, trading volume, and delivery notices. The order found that starting in October 2012, CFTC staff informed ICE of errors in its clearing member reports, permanent record data, and transaction-level trade data. ICE initially attributed the errors to technology upgrades and data migration, claiming the inaccuracies did not affect publicly available data on its website.
Despite assurances that the issues would be resolved, ICE continued to submit faulty reports, even after being told by CFTC staff that doing so was unacceptable. The company was also slow to respond to inquiries from multiple divisions within the CFTC, including the Division of Enforcement. Ultimately, ICE fully cooperated with the investigation and implemented effective corrective actions, which the CFTC considered when reaching the settlement.
The CFTC order outlines the $3 million penalty and requires ICE to adhere to the outlined undertakings to enhance its reporting compliance.
Source: CFTC.gov
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