CFTC: Ice compliance staff under “strain”

The IntercontinentalExchange (Ice) Futures US compliance team has been under “strain” and should hire additional staff, according to a recent Commodity Futures Trading Commission (CFTC) review.

The CFTC report highlighted the reduction in the exchange’s compliance team since 2004, the last time it carried out a similar review. It noted the team’s experience, but said it was affected by several “significant events” during the review period of June 1, 2007 to June 1, 2008. New York-based Ice Futures US is a global soft commodity futures and options exchange.

According to a statement from the CFTC: “These events placed a notable strain on staff’s ability to fulfill important self-regulatory obligations in a timely manner.”

Affected tasks included completing a saturation audit trail record-keeping review, as well as several investigations the CFTC said were open for “excessively long time-periods”.

The CFTC’s Division of Market Oversight carried out the review, which assessed Ice Futures’ compliance with core principles relating to audit trail, trade practice surveillance, disciplinary and dispute resolution programmes. It has recommended that Ice Futures hire additional compliance staff and monitor the size and workload of the department, increasing staff count as appropriate.

The Division also identified additional areas for improvement: it recommended Ice Futures US ensure open outcry saturation record-keeping reviews are conducted annually, and said it should re-examine its trading card compliance programme.

The CFTC also advised Ice Futures to complete investigations in a timely manner and record the date on which completed investigative reports are approved by senior compliance staff.