Washington, D.C. – Tyson Foods, Inc. has agreed to pay $1.5 million to settle charges brought by the Commodity Futures Trading Commission (CFTC) for exceeding position limits and failing to comply with reporting requirements related to grain futures contracts. The CFTC announced the settlement on August 13, 2021.
According to the CFTC, between January 2016 and January 2021, Tyson Foods repeatedly exceeded federal position limits for soybean meal futures contracts traded on the Chicago Board of Trade (CBOT). On over 590 dates, the company held positions averaging 2,473 contracts – roughly 38% – over the 6,500-contract limit, peaking at 7,057 contracts over the limit. These violations occurred without qualifying for a hedge exemption.
The investigation also revealed inaccuracies in reports filed with the CFTC. From at least January 2016 through August 2020, Tyson submitted Form 204 statements, which report cash positions in grain, containing false information. These inaccuracies included reporting nonexistent fixed-price cash sales of soybean meal, overstating corn sales, and failing to report transactions from its own grain elevators.
Furthermore, the CFTC found that Tyson failed to maintain required records of cash transactions related to the excessive futures positions, violating recordkeeping regulations.
The CFTC acknowledged Tyson’s substantial cooperation throughout the investigation, including self-reporting additional violations and demonstrating remediation efforts. This cooperation was considered when determining the $1.5 million civil monetary penalty. The order requires Tyson Foods to cease and desist from further violations of the Commodity Exchange Act and CFTC regulations.
The case was led by CFTC staff members Ashley J. Burden, Joseph Konizeski, Kelly Beck, Janet Briner, Scott Williamson and Robert Howell.
Source: CFTC.gov
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