U.S. COMMODITY FUTURES TRADING COMMISSION

OFFICE OF INSPECTOR GENERAL

Three Lafayette Centre

1155 21st Street, NW, Washington, DC 20581

TO: Rostin Behnam, Acting Chairman

Dawn Stump, Commissioner

Dan M. Berkovitz, Commissioner 

FROM: A. Roy Lavik, Inspector General

DATE: September 29, 2021 

SUBJECT: Inspector General’s Assessment of the Most Serious 

Management and Performance Challenges Facing 

the Commodity Futures Trading Commission FY

2021

The Reports Consolidation Act of 2000 (RCA)1 authorizes the CFTC to 

consolidate financial and performance management reports and to provide 

information in a meaningful and useful format for Congress, the President, and

the public. The RCA requires the Inspector General to summarize the “most

serious management and performance challenges facing the agency” and briefly

assess the Agency’s progress in addressing those challenges.2 This 

memorandum fulfills our duties under the RCA.

To complete our assessment, we relied on data contained in the CFTC financial 

statement audit and Agency Financial Report, representations by agency 

management, and our knowledge of industry trends and CFTC operations. The 

Government Performance and Results Modernization Act of 2010 defines major 

management challenges as “programs or management functions, within or across 

agencies, that have greater vulnerability to waste, fraud, abuse, and 

mismanagement (such as issues identified by the Government Accountability 

Office as high risk or issues identified by an Inspector General) where failure to 

perform well could seriously affect the ability of an agency to achieve its mission 

or goals.”3

 1 P.L. 106-531, § 3, 114 STAT. 2537 (Nov. 22, 2000), codified at 31 USC § 3516(a). 2 Id.

3 P.L. 111-352, § 3, 124 STAT. 3870 (Jan. 4, 2011), codified at 31 U.S.C. § 1115(h)(5). 
2 

CFTC’s Progress on Last Year’s Management and Performance 

Challenges

For FY 2020, we reiterated information technology (IT) modernization and data 

governance as management challenges, and recognized the Agency 

appointed a new Chief Information Officer (CIO) and established the position 

of Chief Data Officer (CDO). Progress on last year’s challenges include 

CFTC’s cloud migration journey, which presents new challenges in a virtual 

and remote work environment. 

We recognize that the CIO and CDO are collaboratively and methodically 

addressing last year’s challenges. We will continue to monitor the progress of 

CFTC’s technological journey.

Fiscal Year 2021 Management and Performance Challenges 

For FY2021, we have identified three management challenges: 

1. Climate change and its impact on the CFTC and the CFTC’s mission; 

2. Management of IT (this is repeated from FY2020 and FY2019 

management challenges); and 

3. Enterprise Risk Management (ERM). 

These challenges, and CFTC’s current actions addressing them, align with the 

President’s risk-related priorities communicated in several Executive Orders.4 

1. Climate Change

Climate change impacts the CFTC’s mission, its physical assets and 

infrastructure, as well as the businesses of market participants. Therefore, we 

consider climate change a management and performance challenge as 

contemplated by the RCA. We are aware that in September 2020, the CFTC 

Climate-Related Market Risk Subcommittee of the Market Risk Advisory 

Committee released a report entitled Managing Climate Risk in the U.S. 

Financial System.

5 In March and August of this year, U.S. Treasury Secretary 

 

4 Executive Order on Protecting Americans’ Sensitive Data from Foreign Adversaries, EO 14034, June 9, 

2021; Executive Order on Improving the Nation’s Cybersecurity, EO 14028, May 12, 2021; and Executive 

Order on Climate-Related Financial Risk, EO 14030, May 2021.

5 Available here: https://www.cftc.gov/sites/default/files/2020-09/9-9-

20%20Report%20of%20the%20Subcommittee%20on%20Climate-Related%20Market%20Risk%20-

%20Managing%20Climate%20Risk%20in%20the%20U.S.%20Financial%20System%20for%20posting.pdf. 
3 

Janet Yellen and Acting Comptroller of the Currency Michael Hsu recognized 

that climate change poses an existential risk to the financial industry.6 Climate 

change impacts both the financial and agricultural markets CFTC regulates,7

and thereby impacts the entirety of the CFTC mission. In this regard, we note 

acting Chairman Behnam launched the CFTC Climate Risk Unit (CRU) in 

March 2021.8 The CRU is comprised of staff from CFTC’s operating divisions 

and offices, and is “intended to accelerate early CFTC engagement in support 

of industry-led and market driven processes in the climate – and larger 

[environmental, social, and governance] – space critical to ensuring that new 

products and markets fairly facilitate hedging, price discovery, market 

transparency, and capital allocation.”9 

2. Management of IT

In addition, emerging threats cause us to again identify management of IT as a 

continuing management challenge. CFTC must understand and be prepared 

to address IT risks that impact both the agency and the industry it regulates. 

As to information security, CFTC cyber defenses report on emerging cyber 

threats, including threats to PII (Personal Identifiable Information). CFTC 

continues to devote resources to its cyber threat response program that 

operates in real-time. 

3. Enterprise Risk Management

Finally, Enterprise Risk Management (ERM) presents a third management 

challenge. An ERM program is a critical asset to the Commission to prioritize 

and respond to a variety of internal and external risks, including IT-related 

risks. In March 2021, the CFTC hired its first Chief Risk Officer, who reports 

directly to the head of the Division of Administration (DA). Resource and 

organizational 

 

6 See, Remarks by Secretary Janet L. Yellen at the Open Session of the meeting of the Financial Stability 

Oversight Council, March 31, 2021, available here: https://home.treasury.gov/news/press-releases/jy0092, 

and Statement of Michael J. Hsu, Acting Comptroller of the Currency before the Committee on Banking, 

Housing, and Urban Affairs, United States Senate, August 3, 2021, available here: 

https://www.occ.gov/news-issuances/congressional-testimony/2021/ct-occ-2021-79-written.pdf. 7 See, Professor Christopher Wolf, testimony before the U.S. Senate Committee on Agriculture, Nutrition, & 

Forestry, Subcommittee on Livestock, Dairy, Poultry, local Food Systems, and Food Safety and Security, 

Milk Pricing: Areas for Improvement and Reform, September 15, 2021, at 2:11:06-2:12:34 states that 

greenhouse gasses and “environmental change” are among the important issues facing dairy farmers. 8 CFTC Release No. 8368-21, CFTC Acting Chairman Behnam Establishes New Climate Risk Unit, March 

17, 2021, available here: https://www.cftc.gov/PressRoom/PressReleases/8368-21. 9 Id. 
4 

constraints may present a challenge to success in this area, and we will 

continue to monitor this area. 

We acknowledge that CFTC’s cloud migration, establishment of a Chief Risk 

Officer, effective cyber response program, and establishment of the CRU each 

advance the President’s risk-related priorities communicated in several 

Executive Orders.10 We will continue to monitor the progress of CFTC’s risk 

related programs as they mature.

Cc: David Gillers, Chief of Staff

Summer Mersinger, Chief of Staff

Erik F. Remmler, Chief of Staff

Tamara Roust, Director, Division of Data

Anthony Thompson, Executive Director & Chief Administrative Officer, Division of Administration 

(DA)

Naeem Musa, Chief Information Security Officer, DA

Joel Mattingley, Chief Financial Officer, DA

Janaka Perera, Chief Information Officer, DA

Edward Padula, Chief Risk Officer, DA

John Rogers, Senior Advisor, DA

 

10 See fn. 4.