The Commodity Futures Trading Commission (CFTC) study of
self-regulatory organisations (SROs) is provoking strong
reactions from industry participants and exchanges.
Exchanges say SROs are not only needed, but they are the
first and last line of defence of an exchange's integrity. But
some in the industry say there is a perception problem for
SROs, especially in the wake of the transitions by exchanges
from member-owned entities toward for-profit or publicly traded
At issue is whether those for-profit exchanges have an
inherent conflict of interest when it comes to policing their
own markets. Some argue exchanges may impose fines to pump up
their revenues or look the other way in the name of profits if
a large-volume customer breaks rules. Exchanges, however,
vehemently defend self-monitoring and say their mandate to
maintain fair markets is even more important now, than when
they were member-owned entities. CFTC is now assembling a team
to study all the issues surrounding SROs over the next few
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