CFTC To Increase Administrative Actions

Nov 10 2014 | 8:05am ET

Even with the Securities and Exchange Commission’s use of administrative proceedings under challenge, the Commodity Futures Trading Commission plans to follow suit.

The regulator will increase its use of administrative-law judges, The Wall Street Journal reports. Unlike the SEC, the CFTC currently allows anyone accused who challenges the accusations to take the case to federal court.

But the CFTC says it is chronically underfunded, and argues that using administrative proceedings will save money. Calling the agency “incredibly stretched,” enforcement chief Aitan Goelman told the Journal that the “overwhelming reason for this change is resources.” Goelman did not say how much the plan would save, nor when the CFTC would begin using them again.

At least initially, the CFTC will have to borrow judges from other government agencies, as it no longer has any of its own.

The move comes amid increasing criticism of the SEC’s administrative process, from judges, lawyers and defendants. Two people have challenged the practice this year; one, a Texas hedge-fund manager and talk-radio host, has seen his bid denied.


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