NCJ Number
150638
Journal
Annals of the American Academy of Political and Social Science Volume: 525 Dated: (January 1993) Pages: 59-70
Date Published
1993
Length
12 pages
Annotation
The Federal Bureau of Investigation (FBI) initiated an extensive undercover investigation of trading abuses in the two largest futures exchanges in the United States in the late 1980's; though the investigation received widespread media attention, the nature and significance of futures trading crimes remain unclear to many people, largely because of the complexity of futures trading itself.
Abstract
The article describes the organization and operation of futures markets and provides an account of offenses targeted by the FBI investigation. Two structural components of futures trading, dual trading and the open-outcry system, criticized as offering ripe opportunities for abuse, are examined in detail. The author contends that efforts to reform the regulation of futures trading can be understood only within the context of organizational forces and pressures acting on futures exchanges and agencies responsible for regulation. In particular, the changing world market and competition for regulatory jurisdiction are offered as guides for understanding reform efforts. The organization and operation of the Commodity Futures Trading Commission (CFTC) are examined, and changes made by the CFTC in response to the FBI investigation are noted. 12 footnotes