CFTC Director of Data and Technology Outlines Initiatives in Data Reporting

CFTC Director of Data and Technology John Rogers reviewed progress toward achieving G-20 swap data reporting goals and outlined initiatives to improve the accuracy, efficiency and timeliness of data reporting. Director Rogers delivered his remarks in testimony before the U.S. House Committee on Agriculture, Subcommittee on Commodity Exchanges, Energy and Credit.

The initiatives included:

Ensuring that data is consistent and high in quality: Director Rogers explained that there are currently variations in how the same information from different counterparties is reported to swap data repositories ("SDRs"). He noted that a simple foreign exchange benchmark or credit default swap index may be reported seven or eight different ways by market participants. This causes problems when the information must be aggregated and analyzed.

Priority Data Elements: Director Rogers stated that the CFTC requested public comment on technical specifications for the reporting of 120 priority data elements, and will use those comments to develop proposals that specify the form, manner and allowable values for each data element.

Ensuring that data is complete: Director Rogers recognized that it was a challenge to provide complete data. He noted that some required fields are not reported by participants and that SDRs do not always reject data that is incomplete.

Refining swap identifiers: The CFTC is working to develop uniform and effective means to identify swaps and swap activity by participant, transaction and product type throughout the life cycle of the swap. This includes the development of the Legal Entity Identifier, the Unique Transaction Identifier and the Unique Product Identifier.

International efforts: Director Rogers stated that the CFTC co-chairs an international task force that currently is leading the effort to harmonize data reporting standards.

Clarifying reporting obligations and eliminating unnecessary reporting obligations: Recently, the CFTC proposed a "simple, consistent process" for the reporting of cleared swaps. If adopted, Mr. Rogers remarked, this clarification would help to minimize the possibility that multiple records of a swap can lead to erroneous double counting, and ensure that accurate valuations of swaps are provided on an ongoing basis. He also asserted that the proposed reporting process would eliminate unnecessary reporting requirements, help to reduce reporting costs, and improve the quality of swap data.

Enforcing reporting obligations: Mr. Rogers stressed that promoting compliance in recordkeeping and reporting, and holding those who are not in compliance accountable, remain important priorities.