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CFTC Judgment Officer Revokes Firm Registration

bzwirb's picture
Commentary / Bob Zwirb

The CFTC announced that it revoked the registration of iFinix Futures, Inc. ("iFinix"), which had been registered with the CFTC as an independent introducing broker, following a permanent injunction in the U.S. District Court for the Eastern District of New York.

The Judgment Officer's Initial Decision on Default, revoking the registration of iFinix, became a final order of the CFTC on October 8, 2014.

See: CFTC Press Release.
Related news: CFTC Obtains Default Judgment against iFinix Futures, Inc. and Its Senior Executive Officer (September 26, 2013); Proceedings before the Commodity Futures Trading Commission; Final Rule (CFTC - Fed. Reg. Version) (with Zwirb Comment) (February 26, 2013); House Appropriations Committee - Draft Committee Report on Agriculture Bill (Including the Future of the CFTC) (with Zwirb Comment) (June 17, 2013).

bzwirb's picture
Commentary / Bob Zwirb

Traditionally, revocation proceedings at the CFTC were handled by Administrative Law Judges ("ALJs"), not lower-level "Judgment Officers" ("JOs"), who instead handled matters of lesser import and were not required to have law degrees. However, in 2012, the CFTC eliminated the ALJ position and amended its rule authority to permit such proceedings to be heard and decided by its sole Judgment Officer. Both from a legal and policy perspective, this practice leaves a lot be desired even where, as here, the matter involved a default judgment. Notwithstanding criticism leveled by the Federal Administrative Law Judges Conference and the House Appropriations Committee (see links below), this practice continues. In the past, the CFTC employed two ALJs and several JOs to handle its caseload. Today, it has only one JO. The failure of a federal administrative regulatory agency to employ even one ALJ suggests that the CFTC placed a low priority on developing an expert body of substantive case law pertaining to the CEA. As Judge Frank Easterbrook once noted, "an agency must act like an expert if it wants the judiciary to treat it as one." Elliott v. CFTC, 202 F.3d 926 (7th Cir. 2000).

Jurisdiction: