Statement of Richard L. Fogel on February 23, 1989 Concerning Commodity Futures Trading Commission and the Chicago Futures Exchanges' Detection of Trade Practice Abuses Before the Committee on Agriculture, Nutrition and Forestry, United States Senate

• NCJ Number: 116925
• Author(s): R L Fogel
• Date Published: 1989
• Length: 17 pages
• Sponsoring Agency: US Government Accountability Office
• Sale Source: Azimuth Inc.; National Institute of Justice/; NCJRS Photocopy Services
• Publication Format: Document
• Publication Type: Legislation/Policy Analysis
• Language: English
• Country: United States of America
• Note: Richard L. Fogel is Assistant Comptroller General for General Government Programs, United States General Accounting Office

Annotation

This statement, delivered before the U.S. Senate by a representative of the General Accounting Office, identifies three indicators to use in judging the potential for futures market trade practice abuses at the Chicago Board of Trade and the Chicago Mercantile Exchange.

Abstract

The first indicator measures the adequacy of the framework of oversight controls and looks specifically at whether the Commodity Futures Trading Commission (CFTC) and the exchanges adequately assessed trading system vulnerabilities and established appropriate controls comparable to those used by other markets and regulators. The second indicator assesses the number and nature of disciplinary actions taken, focusing on whether reliable and sufficient data exist to measure the extent of abuses. The third indicator uses oversight data from trading activities, investigations conducted, and penalties imposed to target abuse trends and improve oversight programs. Additionally, the CFTC and the exchanges are looking into the aspects of the open-outcry trading method that foster trading abuses.