CFTC lowers ceiling on manipulation

Author: | Published: 19 Nov 2010

The Commodities Futures Trading Commission (CFTC) has expanded its definition of scienter (wilful wrongdoing) in its recent anti-manipulation regulation, meaning “recklessness” could now be regarded as intentional fraud.

On October 26 the CFTC proposed regulation to implement Section 753 of the Dodd-Frank Act, concerning manipulation in the futures and swaps markets.

The proposals draw heavily on the Securities and Exchange Commission (SEC)’s Rule 10b-5, which establishes the criteria used to determine if manipulation takes place.

One such standard that must be...