SEC, CFTC Should Improve Fine Collection

WASHINGTON (HedgeWorld.com)–The Securities and Exchange Commission and the Commodity Futures Trading Commission both need to collect more of the fines the two groups levy, according to a report by the U.S. General Accounting Office.

The SEC collected just 40% of fines levied from 1997 through 2002, while the CFTC collected 45% of fines in the same period, according to a GAO report. That doesn’t compare well with most other oversight groups, such as the National Association of Securities Dealers, which collected 66% of fines, the Chicago Mercantile Exchange, which collected 96% of fines, and the New York Stock Exchange, which collected 100% of fines.

The GAO noted in a summary of its report that the SEC and CFTC have improved their efforts, but they need to make better use of the U.S. Treasury’s collection services, which may aid them with collecting delinquent fines, particularly cases going way back. The SEC “has not developed a formal strategy for referring older cases, reducing the likelihood of collecting monies on what could be more than a billion dollars of delinquent debt,” the GAO states in its report.