CFTC flexs muscles, enforcement cases hit a record
* CFTC filed 99 enforcement actions, up 74 pct from 2010
* Cases in FY12 guided by new Dodd-Frank powers - Meister
By Christopher Doering
WASHINGTON, Oct 6 (Reuters) - Enforcement cases filed by the U.S. Commodity Futures Trading Commission surged 74 percent in fiscal year 2011 to its highest level in history as the futures regulator followed through on a promise by its new enforcement chief to crack down on fraud and manipulation.
The futures regulator on Thursday said it filed 99 enforcement actions during the fiscal year that ended on Sept. 30, up from 57 a year ago.
During the same time in FY 2011, the CFTC obtained orders imposing over $290 million in civil monetary penalties, and directing the payment of more than $160 million in restitution and disgorgement, more than double the prior year.
"More than ever, it's a sign of how closely markets need to be policed," Bart Chilton, a Democratic CFTC commissioner, said in prepared remarks to be delivered in Houston.
"I think that especially when the economy is shaky, the swindlers swarm, but we are catching them and keeping our markets safer as a result," he said.
David Meister, the CFTC's director of enforcement, said earlier this year he will aggressively use his "bigger arsenal of weapons" to crack down on fraud and manipulation in the marketplace. [ID:nN0597782]
The agency will keep cracking down on schemes that prey on retail investors -- until recently the hallmark of the agency's enforcement division -- but now will also focus the spotlight on investigating broader industry and over-the-counter fraud and manipulative schemes, he said.
Meister said on Thursday the agency's enforcement activities will be guided by new and expanded enforcement authorities provided by the Dodd-Frank Act. The agency filed 23 actions in FY2011 enforcing new regulations from the law.
Among the CFTC's new powers from Dodd-Frank include the ability to prosecute fraud-based manipulation as well as targeting disruptive trading practices and other misconduct on registered entities.
Some market watchers expect to see more cases, such as the one the CFTC filed in May when it charged traders Nick Wildgoose of London-based Arcadia Energy and James Dyer of Oklahoma's Parnon Energy, and their companies, for manipulating oil prices. [nN03171984] The charges came under CFTC's authority before Dodd-Frank. (Editing by Marguerita Choy)
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