CFTC's proposed self-reporting rule raises questions

Author: | Published: 11 Dec 2017

The CFTC has said that if a company reports and remediates any issues of its own accord, it will likely face lower financial penalties. But the proposal’s effects in practice remain to be seen

When a company discovers a potential regulatory problem, whether misconduct by one of its employees or the failure of a compliance system, the decision whether to self-report the problem to its regulators is rarely clear cut. While regulators tout the benefits of self-reporting, companies are often unsure whether the potential benefit of self-reporting – which can be uncertain and hard to quantify – outweighs the cost of an enforcement action that might not be brought if the company decides just to go ahead and correct the problem without self-reporting. As a result, even companies that want to do the right thing often decide to roll the dice and wait to see whether the government ever investigates....



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