June 29, 2022

FIA Criticizes CFTC CCO Annual Reports Requirements

Nihal Patel Commentary by Nihal Patel

FIA submitted a comment letter questioning the value of certain compliance resource information required to be submitted as part of FCM and swap dealer CCO annual reports.

The FIA letter, which came in response to a CFTC Paperwork Reduction Act request to renew collection of information in CCO annual reports, primarily addresses concerns relating to allocating resource information in corporate families where more than one regulator may oversee a particular entity or group of affiliated entities. FIA argued that CFTC requirements (elaborated in CFTC Letter 19-24) that require entity-specific determinations of resources create a burden on firms that is substantially higher than CFTC estimates and is "not justified by any potential benefit being provided."

FIA urged the CFTC to take a "more principles-based approach" to this information collection and welcomed further conversations with CFTC staff on the issue.


The FIA letter highlights one example of the difficulties of operating in a fractured and multi-faceted regulatory environment. While the government undoubtedly has an interest in determining that firms are complying with substantive laws, laws setting forth the process by which such compliance is achieved are sometimes unnecessarily specific in light of a broader view of the ways in which financial institutions operate in practice.

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