It’s been tough times for the futures industry lately. First there was the collapse of MF Global in October 2011, followed by the Peregrine Financial Group implosion in July 2012.
Both failures rocked the futures world including its traders, customers, as well as the trust of the industry and its leaders. Regulators have been busy trying to find the holes that led to the problems and answering questions why this happened. Again.?
In a new Crain’s story by Lynne Marek, “Futures regulators challenged by changing industry,” she explores?five years of enforcement action by the futures markets regulators, CME Group Inc. (NASDAQ:CME) and the National Futures Association to seek some answers.?
Some of the story’s key findings include the following:
? Actions against firms like MF Global and Cedar Falls, Iowa-based Peregrine, the entities that deal with customer money, accounted for only a small percentage of regulatory cases.
? The overall caseload has plummeted even as trading volume is growing.
? Especially at CME, regulators prefer to fine violators and allow them to continue to operate, rarely turning to harsher punishments even for repeat offenders.
In addition, Marek also writes, “while both organizations are overseen by the federal Commodity Futures Trading Commission, they often act like private clubs, meting out discipline with little transparency.”
For some, the story may seem like business as usual while others may be inclined to ask more questions and seek change.?
Here’s a link to the story.