INSPECTOR GENERAL A. ROY LAVIK

Roy Lavik is the longest serving Inspector General 

currently in office.1 He has served since 1990.

Roy Lavik has over 50 years of federal service, primarily in the area of anti-trust and regulatory 

law. He has held evaluation review positions at the Federal Trade Commission and the Federal 

Reserve Board, and has supervised litigation in antitrust cases. Additionally, he has spent time in 

private practice performing corporate counseling. A Knoxville, Tennessee native, Mr. Lavik 

received undergraduate, law school, and graduate business school degrees from the University of 

Chicago. Mr. Lavik began service as Inspector General for the CFTC in October 1990. 

The IG is a member of the Council of Inspectors General on Financial Oversight (CIGFO), created 

under the Dodd-Frank Act to examine the work of the Financial Stability Oversight Council 

(FSOC). The IG is also member of the Council of the Inspectors General on Integrity and 

Efficiency (CIGIE), an independent entity established within the executive branch to address 

integrity, economy and effectiveness issues that transcend individual Government agencies and to 

aid in the establishment of a professional, well-trained and highly skilled workforce in the Offices 

of Inspectors General. The IG is a member of the CIGIE Legislation Committee, which monitors 

legislation impacting the IG community and creates a yearly legislative agenda for the IG 

community. 

 

1 Frank Chen, Employment Duration and Attrition of Federal and State Inspectors General in the United States, 

page 75, The Graduate Center, City University of New York, September 2019 

(https://academicworks.cuny.edu/gc_etds/3289/). 
U.S. COMMODITY FUTURES TRADING COMMISSION

Three Lafayette Centre

1155 21st Street, NW, Washington, DC 20581

Telephone: (202) 418-5110

October 31, 2022 

TO: Rostin Behnam, Chairman 

Kristin Johnson, Commissioner

Christy Goldsmith Romero, Commissioner 

Summer Mersinger, Commissioner

Caroline Pham, Commissioner 

FROM: A. Roy Lavik 

Inspector General

SUBJECT: Semiannual Report of the Office of the Inspector General 

Attached is the Office of the Inspector General’s Semiannual Report for the period from 

April 1, 2022, through September 30, 2022. This report is submitted to you in accordance with 

the requirements of Section 5 of the Inspector General Act of 1978, as amended, and summarizes 

completed reports and ongoing projects during the reporting period. 

 I appreciate your continuing support of my Office. 
i 

SEMIANNUAL REPORT 

OF THE U.S. COMMODITY FUTURES TRADING COMMISSION

OFFICE OF THE INSPECTOR GENERAL

April 1, 2022 – September 30, 2022 

TABLE OF CONTENTS

EXECUTIVE SUMMARY .......................................................................................................... 3

CFTC PROGRAMS and OPERATIONS .................................................................................. 3

CFTC OIG RESPONSIBILITIES, RESOURCES, ORGANIZATION, and 

INDEPENDENCE......................................................................................................................... 4

REQUIRED STATEMENT REGARDING INFORMATION ACCESS AND ASSISTANCE ........................... 7

AUDIT OPERATIONS ................................................................................................................ 8

COMPLETED AUDITS, AUDIT REVIEWS, AND OTHER AUDIT PROJECTS ........................................ 8

CFTC Compliance with the Payment Integrity Information Act (PIIA) of 2019 .................... 8

Council of Inspectors General on Financial Oversight: Crisis Response .............................. 8

ONGOING AUDITS, AUDIT REVIEWS, AND OTHER AUDIT PROJECTS ............................................ 8

Audit of the CFTC’s FY 2022 Annual Financial Report ........................................................ 8

Audit of the CFTC’s FY 2022 Customer Protection Fund ..................................................... 9

Federal Information Security Management Act (FISMA) Review: FY 2022 ......................... 9

Council of Inspectors General on Financial Oversight: Response to the Executive Order on 

Climate-Related Financial Risk .............................................................................................. 9

AUDIT REPORTS AND REVIEWS OVER SIX MONTHS OLD; REQUIRED STATEMENTS .................... 9

Table 1: Unimplemented Recommendations ................................................................... 10

Table 2: Detail of Unimplemented Recommendations .................................................... 10

INSPECTIONS & EVALUATIONS ......................................................................................... 10

ONGOING INSPECTIONS & EVALUATIONS .................................................................................. 11

CFTC Whistleblower Office’s Confidentiality Protections .................................................. 11

CFTC Policies and Procedures Concerning Capturing, Retaining and Accessing Cell 

Phone Data, Including Text Messages, Location, and Other Information / Data ................ 11

OIG Inspection and Evaluation of the CFTC’s Current and Post-Covid Lease Operations 

and Space Planning .............................................................................................................. 11

OIG Inspection and Evaluation of the CFTC’s Disaster Preparedness ............................... 11

INVESTIGATIVE OPERATIONS ........................................................................................... 12

INVESTIGATIONS ........................................................................................................................ 12

ALLEGATIONS ............................................................................................................................ 12

ONGOING INVESTIGATIVE MATTERS AND REQUIRED DISCLOSURES .......................................... 12

Table 3: Investigative Statistics for Referrals and Whistleblower Retaliation ................ 12
ii

LEGAL & ECONOMIC RESEARCH ..................................................................................... 13

ONGOING LEGAL & ECONOMIC RESEARCH PROJECTS ............................................................... 13

LEGISLATIVE & REGULATORY PROJECTS ................................................................... 13

PEER REVIEWS ........................................................................................................................ 14

Most Recent Peer Review of the CFTC OIG Audit Function ............................................... 14

Most Recent Peer Review of the CFTC OIG Investigative Function .................................... 14

Peer Reviews completed by CFTC OIG during the reporting period .................................. 15

SUMMARY of FINAL REPORTS NOT MADE PUBLIC..................................................... 15

ADMINISTRATIVE ACTIVITIES .......................................................................................... 15

OIG TRANSITION TO A POST-PANDEMIC WORKPLACE .............................................................. 15

STRATEGIC PLAN for the OFFICE of INSPECTOR GENERAL ..................................... 16

MISSION, VISION, AND VALUES ................................................................................................. 16

STRATEGIC GOAL 1: EVALUATE THE ECONOMIC IMPACT OF CFTC REGULATORY ACTIONS 

THROUGH LEGAL ANALYSIS, WHITE PAPERS, INSPECTIONS AND EVALUATIONS, MANAGEMENT 

REVIEWS, AND OTHER PRODUCTS .............................................................................................. 17

Office of Legal and Economic Research (OLER): Legislative, Economic, and Regulatory 

Review Agenda ...................................................................................................................... 17

STRATEGIC GOAL 2: ADDRESS HIGH IMPACT ISSUES IN CFTC ADMINISTRATIVE AND MISSION 

PERFORMANCE ........................................................................................................................... 17

Office of Audits: Audit and Review Agenda .......................................................................... 17

STRATEGIC GOAL 3: ADDRESS EMPLOYEE AND CONTRACTOR MISCONDUCT PROMPTLY,

THOROUGHLY, AND RELIABLY .................................................................................................. 19

Office of Investigations: Investigative Agenda ..................................................................... 19

STRATEGIC GOAL 4: ADDRESS MINOR OPERATIONAL AND MANAGEMENT ISSUES PROMPTLY 

THROUGH THE USE OF INSPECTIONS & EVALUATIONS (I&E) ..................................................... 19

CONTACTING the OFFICE of the INSPECTOR GENERAL ............................................. 20

APPENDICES ............................................................................................................................. 21

Appendix 1 – Reports Issued with Questioned Costs .............................................................. 21

Appendix 2 – Reports Issued with Recommendations That Funds Be Put to Better Use .... 22

Appendix 3 - Index of IG Act Reporting Requirements ......................................................... 23
3

EXECUTIVE SUMMARY

This semiannual report is issued by the Commodity Futures Trading Commission 

(CFTC) Office of the Inspector General (OIG) pursuant to the Inspector General Act of 1978, as 

amended.2 It summarizes OIG’s activities and accomplishments for the period April 1, 2022, 

through September 30, 2022. During this period: 

• The Office of Audits completed one audit in compliance with financial requirements and 

one informational project in collaboration with the Council of Inspectors General on 

Financial Oversight (CIGFO), with no significant issues noted. We continued work on 

two financial audits, one cybersecurity audit, and one audit in collaboration with CIGFO. 

• We began the reporting period with three investigations pending, opened no additional 

investigations, and closed no investigations. Management provided comment on three 

reports of investigation issued during the prior reporting period, those comments were 

pending with OIG management at the close of the reporting period, and we therefore 

consider those three investigations to be reopened. We closed the reporting period with 

six open investigations. 

• We began the reporting period with four pending Inspections and Evaluations (I&E), 

having issued one of those four in Management Draft form to the Commission during the 

prior reporting period. During this reporting period we received the Management 

response. We finished the reporting period with four pending I&E’s. 

• The Office of Legal and Economic Research continued work on two whitepapers begun 

in a prior reporting period. Due to the departure of two attorneys assigned to the 

whitepaper projects, both projects have been suspended. 

CFTC PROGRAMS and OPERATIONS

Established by statute as an independent agency in 1974, the CFTC assumed 

responsibilities previously belonging to the U.S. Department of Agriculture since the 1920s.3

The mission of the CFTC is: “To promote the integrity, resilience, and vibrancy of the U.S. 

derivatives markets through sound regulation.”4 The CFTC and its predecessor were established 

to protect market participants and the public from fraud, manipulation, and other abusive 

practices in the commodity futures and options markets. After the 2008 financial crisis and the 

subsequent enactment of the Dodd-Frank Act, the CFTC’s mission expanded to include 

oversight of the swaps marketplace.5 

 

2 P.L. 95-452, 92 Stat. 1101 (1978). 3 U.S. Commodity Futures Trading Commission, Strategic Plan FY 2020-2024 (May 2020), page 4. All links in this 

paper were last tested on April 24, 2022. 

4 Id., page 3. 

5 Id., page 4.
4

The Commission consists of five Commissioners appointed by the President, with the 

advice and consent of the Senate, who serve staggered five-year terms. The President appoints 

one of the Commissioners to serve as Chairman. No more than three Commissioners may be 

from the same political party.6 The CFTC maintains offices in Washington, D.C.; New York, 

NY; Chicago, IL; and Kansas City, MO. The CFTC organization consists of the following 

Divisions and Offices (not including OIG):7

• Division of Clearing and Risk (DCR)

• Division of Enforcement, including the Whistleblower Office (DOE)

• Division of Market Oversight (DMO)

• Market Participants Division (MPD)

• Division of Data (DOD)

• Office of the General Counsel (OGC) (formerly Legal Division) 

• Division of Administration (DA)

• Office of the Chief Economist (OCE)

• Office of International Affairs (OIA)

• Office of Public Affairs (OPA)

• Office of Technology Innovation (OTI)8

• Office of Legislative and Intergovernmental Affairs (OLIA)

• Office of Minority and Women Inclusion (OMWI)

CFTC OIG RESPONSIBILITIES, RESOURCES, ORGANIZATION, 

and INDEPENDENCE

CFTC OIG RESPONSIBILITIES

The CFTC OIG was created in 1989 in accordance with the 1988 amendments to the 

Inspector General Act of 1978.9 OIG was established as an independent unit to:

• Promote economy, efficiency, and effectiveness in the administration of CFTC programs 

and operations, and detect and prevent fraud, waste, and abuse in such programs and 

operations; 

• Conduct and supervise audits and, where necessary, investigations relating to the 

administration of CFTC programs and operations; 

 

6 7 U.S.C. § 2(a)(2). 

7 https://www.cftc.gov/About/CFTCOrganization/index.htm. 8 OTI was announced on July 25, 2022. https://www.cftc.gov/PressRoom/SpeechesTestimony/opabehnam24. 9 The Inspector General Act Amendments of 1988, P.L. 100-504, 102 Stat. 2515 (1988). 
5

• Review existing and proposed legislation, regulations, and exchange rules and make 

recommendations concerning their impact on the economy and efficiency of CFTC 

programs and operations or the prevention and detection of fraud and abuse; 

• Recommend policies for, and conduct, supervise, or coordinate other activities carried out 

or financed by such establishment for the purpose of promoting economy and efficiency 

in the administration of, or preventing and detecting fraud and abuse in, its programs and 

operations; and

• Keep the Commission and Congress fully informed about any problems or deficiencies in 

the administration of CFTC programs and operations and provide recommendations for 

correction of these problems or deficiencies.

The IG is appointed by the Commission in accordance with the applicable laws and regulations 

governing appointments within the CFTC, and may be removed upon the written concurrence of 

a 2/3 majority of the Commission.10 CFTC OIG conducts audits engagement in accordance with

the Generally Accepted Government Auditing Standards (GAGAS) issued by the Government 

Accountability Office (GAO). OIG conducts inspections, evaluations, and other covered 

products in accordance with the Quality Standards for Inspection and Evaluation issued by the 

CIGIE. OIG investigations are performed in accordance with the Quality Standards for 

Investigations issued by the CIGIE. The Office of Legal and Economic Research may conduct 

inspections, evaluations, and other covered products in accordance with the CIGIE standards 

cited above, and may produce white papers and other studies in accordance with internal 

standards. Our webpage is located at https://www.cftc.gov/About/InspectorGeneral. 

CFTC OIG RESOURCES AND ORGANIZATION

CFTC OIG maintains an Office of Audits, Office of Investigations, and Office of Legal 

and Economic Research. At the end of the reporting period, the CFTC OIG consisted of eleven 

FTEs. However, during this reporting period, two attorneys departed, severely hampering our 

ability to complete investigations, inspections & evaluations, and white papers, some already in 

progress. We are in the process of backfilling these positions. 

Our organizational chart follows on the next page. 

 

10 5 U.S.C. App. §§ 8G(c), 8G(e)(1). 
6

During this reporting period, five paid interns participated in the A. Roy Lavik Inspector 

General Honors Internship Program. Our current maximum telework policy permitted us to 

recruit nationwide, and we were able to obtain exceptional talent and diversity, including a 

military veteran with a 10-point hiring preference. This opportunity to acquire extraordinary 

talent would not have been available but for our current telework policy. We would like to 

recognize our interns, who produced work of exceptional quality for our Office during the 

reporting period: 

Data Scientist Intern: 

• Natasha Bertrand, MS Candidate 2022 (Applied Economics) 

Legal Interns:

• Vanelisse Encarnación Rodríguez, J.D. Candidate 2022 

• Ben Hyman, Georgetown University Law Center, J.D. Candidate 2023 

• Robert Carlos Martinez Cornell, J.D. Candidate 2024 

• Jimmie B. Webb, J.D. Candidate 2024 
7

OIG INDEPENDENCE

OIG operates independently of the Agency. Our investigations have been pursued 

regardless of the rank or party affiliation of the target. OIG has conducted audits, inspections, 

evaluations, and reviews without intentional, substantive interference whenever it has perceived 

the opportunity to recommend improvement to agency administration and to futures regulation 

efforts, again without regard to the party affiliation of any Chairman or Commissioner.11 

REQUIRED STATEMENT REGARDING INFORMATION ACCESS AND ASSISTANCE

During the reporting period, no reports were made to the Agency head under section 

6(b)(2) concerning information or assistance unreasonably refused or not provided (mandated 

under section 5(a)(5) of the Act); however, we experienced what we interpreted as a direct and 

intentional attempt to interfere with Inspector General independence through intimidation of OIG 

investigative staff with unfounded allegations of misconduct which were forwarded to the CIGIE 

Integrity Committee. Despite these meritless allegations, OIG work continued unabated, and the 

full Commission was notified. 

Type of Interference Number Explanation

Budget constraints 0 N/A

Resistance to oversight 0 N/A

Delayed information access 0 N/A

Other (Intimidation) 1 See above

 

11 The Inspector General Act of 1978, as amended, states: “[T]he head of the designated Federal entity shall not 

prevent or prohibit the Inspector General from initiating, carrying out, or completing any audit or investigation....” 5 

U.S.C. App. 3 § 8G(d)(1). 
8

AUDIT OPERATIONS 

COMPLETED AUDITS, AUDIT REVIEWS, AND OTHER AUDIT

PROJECTS

Financial 

CFTC Compliance with the Payment Integrity Information Act (PIIA) of 2019 – Our objectives 

were to determine whether the CFTC is compliant with PIIA12 given that it did not report on 

payment integrity in its 2021 Financial Statements and to perform an independent risk 

assessment of CFTC payments to determine whether CFTC is a Phase 1 or Phase 2 agency.13

Our risk assessment confirmed that CFTC is a Phase 1 agency or below the established threshold 

for improper payments. However, we found one instance of noncompliance with statutory 

reporting requirements in the CFTC agency financial report, and recommended that reporting 

comply with reporting requirements. The agency response was adequate and we closed the 

recommendation. 

Other

Council of Inspectors General on Financial Oversight: Crisis Response – During the prior 

reporting period, CIGFO convened a working group to compile guidance to FSOC for preparing 

for a crisis, along with crisis response lessons learned, based on detailed survey responses from 

the FSOC member agencies. The final report was issued during this reporting period. 

ONGOING AUDITS, AUDIT REVIEWS, AND OTHER AUDIT PROJECTS

Financial 

Audit of the CFTC’s FY 2022 Annual Financial Report – The objective of this Congressionally 

mandated audit14 is to render an opinion on the agency financial report (financial statements) in 

accordance with GAGAS. 

 

12 P.L. 116-117, 134 Stat. 113 (2020). 13 All programs with annual outlays over $10,000,000 will fall into one of two possible classifications: Phase 1 or 

Phase 2. Programs that are not likely to have an annual amount of improper payments (IP) plus unknown payments 

(UP) above the statutory threshold (which is either (1) both 1.5 percent of program outlays and $10,000,000 of all 

program payments made during the FY or (2) $100,000,000) are referred to as being in Phase 1. If a program in 

Phase 1 is determined likely to exceed the Phase 1 statutory threshold, then the program will move into ‘Phase 2’ the 

following year. Once in Phase 2, a program will have additional requirements. See, OMB Circular A-123, Appendix 

C, Requirements for Payment Integrity Improvement, OMB M-21-19, p.6, March 5, 2021. 14 The Accountability of Tax Dollars Act, P.L. 107-289, 116 Stat. 2049 (2002).
9

Audit of the CFTC’s FY 2022 Customer Protection Fund (CPF) – The objective of this 

Congressionally mandated audit15 is to render an opinion on customer protection fund financial 

statements in accordance with GAGAS. 

Information Technology Management and Security 

Federal Information Security Management Act (FISMA) Review: FY 2022 – The objective of 

this review is to evaluate CFTC’s information security program and practices as required by 

FISMA.

16 These years audit focused on 20 core controls.

Other

Council of Inspectors General on Financial Oversight: Response to the Executive Order on 

Climate-Related Financial Risk - The review objective is to determine what actions FSOC 

members have taken, or planned, in response to Executive Order (EO) 14030,17 and whether 

those actions are consistent with the policy, objectives, and directives set forth in the EO.

AUDIT REPORTS AND REVIEWS OVER SIX MONTHS OLD; REQUIRED STATEMENTS

Required Statements Regarding Commission Response Exceeding 60 Days, and Regarding 

Management Decisions Not Made

There were no audit reports issued during the reporting period lacking Commission 

response within 60 days, and no instances of an audit report issued before the commencement of 

the reporting period for which a management decision had not been made by the end of the 

reporting period. 

Required Statements Regarding Revised Management Decisions, and Regarding Inspector 

General Disagreement

No management decisions were revised during the reporting period, and the Inspector 

General did not disagree with any management decisions on OIG audit recommendations during 

the reporting period. 

Required Statements Regarding Significant Recommendations that have not been 

Completed, and Audit Reports for which there are any Outstanding Unimplemented 

Recommendations, Including Aggregate Potential Cost Savings 

There are two audit reports with a management action date over six months old where the 

recommendation for corrective action had not been completed. Outstanding recommendations 

are relayed in the two tables that follow, with explanatory text.

 

15 P.L. 111-203, § 748, 124 Stat. 1739 (2010). 16 Federal Information Security Management Act of 2002 (FISMA), P.L. 107-347 (Title III), 116 Stat. 2946 (2002). 17 Executive Order (EO) 14030, Climate-Related Financial Risk, 86 F.R. 27967 (May 20, 2021).
10

Table 1: Unimplemented Recommendations 

Fiscal

Year

Number of Reports 

with Unimplemented 

Recommendations 

Number of 

Unimplemented 

Recommendations 

Dollar Value of 

Aggregate 

Potential Cost 

Savings

No Comment 

Returned 

w/in 60 days

2022 1 1 0 0

2021 1 1 0 0

Totals 2 2 0 0

Table 2: Detail of Unimplemented Recommendations 

Fiscal 

Year

Audit Report Unimplemented Recommendations

2022 CFTC Compliance with the 

Payment Integrity Information 

Act (PIIA) of 2019*

One recommendation to include payment integrity 

analysis with relevant links and estimates in future 

AFRs as required by OMB M-21-19.

2021 Federal Information Security 

Management Act Review: FY 

2020**

One recommendation to enhance CFTC’s privacy 

program. 

* We will complete a follow-up review of FY 2022 risk assessments and the agency’s financial 

report by the end of calendar year 2022. 

** In FY20, the privacy program completed a comprehensive review of federal privacy laws and 

policies and determined that the Commission’s existing privacy policies and procedures were 

out-of-date and that they did not reflect requirements in law and policy. In FY21, the program 

worked with stakeholders across the Commission to draft an enterprise privacy policy that aligns 

with the requirements in federal privacy laws and policies. In FY22, the privacy program 

planned to draft associated privacy procedures and work with the CFTC Administrative Policy 

Program to facilitate the intra-agency review of the proposed policy and procedures. The Chief 

Privacy Officer continues to work with the Senior Agency Official for Privacy to review the 

privacy program’s staffing and resourcing and to develop a plan to address the current resource 

constraints.

INSPECTIONS & EVALUATIONS

We began the reporting period with four I&E in process. During the reporting period, two 

attorneys assigned to assist I&E departed for the private sector, which severely impacted our 

timeline for completion of projects. All four I&E were ongoing at the close of the reporting 

period. 
11

ONGOING INSPECTIONS & EVALUATIONS

CFTC Whistleblower Office’s Confidentiality Protections (2021-IE-2) – to assess the policies 

and procedures concerning whistleblower confidentiality protections, including policies and 

procedures concerning inadvertent disclosures; 

CFTC Policies and Procedures Concerning Capturing, Retaining and Accessing Cell Phone Data, 

Including Text Messages, Location, and Other Information / Data (2021-IE-3) – to assess the 

collection and retention policies of the CFTC with respect to CFTC issued mobile devices. OIG 

assessed CFTC’s practices for capturing, retaining, and accessing data created on smartphones 

issued to CFTC employees and contractors, including text messages, recorded messages and 

other recordings, lists, documents, location data, and other data. On March 31, 2022, OIG issued 

its draft report and draft recommendations to agency management. Preliminarily, OIG 

determined that current practices risk violations of the Federal Records Act, and are not best 

practices. OIG recommended the Agency adjust current practices and current controls, in 

accordance with the Federal Records Act, to better enable the Agency to regulate the markets 

under its jurisdiction. Because CFTC requires significantly greater retention of electronic 

communications data of CFTC registrants, OIG believes the Agency should be able to undertake 

comparable practices both technologically and practically. We issued a Management Draft to the 

Commission for comment on March 31, 2022, with six proposed recommendations, and during 

this reporting period we received the management response. 

OIG Inspection and Evaluation of the CFTC’s Current and Post-Covid Lease Operations and 

Space Planning (2022-IE-1) – to assess the CFTC’s space needs post-pandemic and its plans to 

meet those needs in an efficient and compliant manner without undue taxpayer expense. This 

assessment will be made against the backdrop of the unique opportunity of the federal 

government in right-sizing its real estate needs in light of the adoption of telework and remote 

work policies and in light of the CFTC’s efforts in promoting Diversity, Equity, and Inclusion 

(“DEI”) and the CFTC’s opportunity to support that DEI vision through nationwide recruiting 

and employment efforts utilizing remote work policies. OIG intends to analyze whether CFTC is 

spending efficiently on current leases and current space build out, as well as the lessons learned 

and applied for each project. The scope of this inspection and evaluation will be FY2019 through 

FY2022; and 

OIG Inspection and Evaluation of the CFTC’s Disaster Preparedness (2022-IE-2) – to assess the 

CFTC’s operations for crises preparedness. In particular, OIG will assess senior leadership’s 

knowledge and preparedness of succession authorities, continuity of operations planning and 

operations, use of GETS cards, and remote, offsite awareness and capabilities. This I&E is a 

component of a broader effort by CIGFO18 to identify risks to the financial stability of the United 

States; promote market discipline; and respond to emerging threats to the stability of the U.S. 

financial system.

We finished this reporting period with four pending I&E’s and no pending recommendations. 

 

18 Council of Inspectors General on Financial Oversight Guidance in Preparing for and Managing Crises, June 

2022, CIGFO-2022-1. 
12

INVESTIGATIVE OPERATIONS 

INVESTIGATIONS

We began the reporting period with three investigations pending, opened no additional 

investigations, and closed no investigations. Management provided comment on three reports of 

investigation issued during the prior reporting period, those comments were pending with OIG 

management at the close of the reporting period, and we therefore consider those three 

investigations to be reopened. We closed the reporting period with six open investigations. 

ALLEGATIONS

We began the reporting period with no allegations pending and received 40 allegations during 

the reporting period through the OIG email hotline (29), the OIG online complaint form (9), the 

OIG phone hotline (1), and regular mail (1). We closed 38 allegations as follows: 

o Referred 29 allegations to Division of Enforcement 

o Referred 1 complainant to CFTC (questions@cftc.gov) to address general questions 

o Referred 1 complainant to the CFTC Office of Whistle Blower 

o Referred 0 complainant to the CFTC MPD for information and assistance 

o Closed 7 allegations due to inadequate evidence19

o Closed no allegation with a new investigation opened 

Two allegations were pending at the close of the reporting period. 

ONGOING INVESTIGATIVE MATTERS AND REQUIRED DISCLOSURES

At the close of this reporting period we have three ongoing investigations and three 

investigations pending OIG response to management comments. All open investigations are 

confidential, as are the content of incoming allegations. As a policy, CFTC OIG does not 

disclose non-public details regarding open investigations absent good cause; if an ongoing 

investigation is disclosed to the public it will be listed here. 

Table 3: Investigative Statistics for Referrals and Whistleblower Retaliation

April 1, 2022 – September 30, 202220

A. Completed investigations 0

B. Referrals to prosecuting authorities for criminal prosecution 0 

C. Indictments from prior referrals 0

D. Whistleblower retaliation findings 0

 

19 Please know that OIG retains all investigation and allegation files for a period of 10 years; if additional 

information or allegations are received in the future, a closed matter may be reopened. 20 We compiled these statistics from a review of our digital files.
13

It is our practice to discuss potential criminal investigations early with an Assistant 

United States Attorney (AUSA) in order to ensure matters of interest are coordinated from the 

outset. While we engaged with AUSAs during the reporting period as necessary to complete our 

work, no formal referrals for prosecution were made. 

There were no findings of whistleblower retaliation during this reporting period. There 

were no reports of investigation involving a senior Government employee where allegations of 

misconduct were substantiated. 

LEGAL & ECONOMIC RESEARCH

ONGOING LEGAL & ECONOMIC RESEARCH PROJECTS

During the reporting period, the two attorneys with responsibility for ongoing our Office of 

Legal and Economic Research projects departed CFTC OIG for the private sector. The two

projects pending at the close of the last reporting period, White Paper Evaluating CFTC 

Experience with the Administrative Procedures Act, and White Paper Evaluating CFTC 

Experience with Digital Assets, have been suspended. 

LEGISLATIVE & REGULATORY PROJECTS 

1. Introduction and Summary 

As specified in Section 4(a)(2) of the Inspector General Act of 1978,21 the Office of 

Legal and Economic Research (OLER) within OIG reviews the impact of existing and proposed 

legislation and regulations on CFTC programs and operations and makes recommendations 

regarding more effective or efficient alternatives or protections against fraud and abuse. The OIG

also reviews exchange rule proposals circulated to senior staff at the CFTC. 

OIG notifies the responsible Divisions as to any concerns with draft and final documents relating 

to legislation, rules or investigations. Formal comments were not submitted to the Commission

during this reporting period. 

2. Legislative Activities

OIG reviews legislation impacting programs and operations of the CFTC, and initiates 

contact with Congressional staff concerning various Agency and IG issues as appropriate. This 

work is performed by OLER. In addition, the IG serves on the legislation committee for the 

Council of Inspectors General on Integrity and Efficiency, which comments on proposed 

amendments to the IG Act and other legislation affecting the IG community. CFTC OIG 

participated in legislation committee efforts. No formal projects were undertaken during this 

reporting period. 

 

21 5 USC App. § 4(a)(2) (made applicable to CFTC OIG at 5 USC App. § 8G(g)).
14

PEER REVIEWS

An important function in each agency OIG is the peer review process. GAGAS require 

that audit organizations conducting audits of Federal agencies undergo peer reviews every three

years. The IG community has implemented a process to meet this requirement and, in accordance 

with GAGAS and CIGIE peer review quality control and assurance standards, an OIG audit team 

assesses other OIGs’ audit functions. The purpose of the peer review is to determine whether the 

reviewed audit organization’s internal quality control systems are adequate and provide 

reasonable assurance that applicable auditing standards, policies and procedures are met. We are 

required to include in each OIG semiannual report:

• The results of any peer review conducted by another Office of Inspector General during the 

reporting period; or if no peer review was conducted within that reporting period, a statement 

identifying the date of the last peer review conducted by another Office of Inspector General;

• A list of any outstanding recommendations from any peer review conducted by another 

Office of Inspector General that have not been fully implemented, including a statement 

describing the status of the implementation and why implementation is not complete; and 

• A list of any peer reviews conducted by the Inspector General of another Office of the 

Inspector General during the reporting period, including a list of any outstanding 

recommendations made from any previous peer review (including any peer review conducted 

before the reporting period) that remain outstanding or have not been fully implemented. 

The required information follows: 

Most Recent Peer Review of the CFTC OIG Audit Function

The Federal Maritime Commission, Office of the Inspector General, reviewed the system of 

quality control for the CFTC OIG audit organization in effect for the year ending March 31, 

2019. In their opinion, the system of quality control for the audit organization of CFTC has been 

suitably designed and complied with to provide CFTC with reasonable assurance of performing 

and reporting in conformity with applicable professional standards in all material respects. CFTC 

OIG received the highest external peer review rating of “pass.” 

Most Recent Peer Review of the CFTC OIG Investigative Function 

Investigative peer reviews are conducted under CIGIE peer review standards to evaluate

compliance with the requirements of the CIGIE Quality Standards for Investigations and the 

adequacy of internal safeguards and management procedures. Because it is a Designated Federal 

Entity Inspector General, the CFTC OIG investigative function is not required to undergo peer 

review. CFTC OIG last voluntarily submitted to a peer review of its investigative function in 

2013; the Federal Trade Commission, Office of Inspector General, reviewed the system of 

quality control for the CFTC OIG investigative function and concluded that the system of 
15

internal safeguards and management procedures for the CFTC OIG investigative function 

complied with the quality standards adopted by CIGIE, and provided a reasonable assurance of 

conforming with professional standards in the conduct of investigations. 

Peer Reviews completed by CFTC OIG during the reporting period

CFTC OIG completed no peer reviews of other OIGs during this reporting period. There are 

no open recommendations from prior peer reviews conducted by CFTC OIG. 

SUMMARY of FINAL REPORTS NOT MADE PUBLIC

All reports issued during this reporting period were published. 

ADMINISTRATIVE ACTIVITIES

OIG TRANSITION TO A POST-PANDEMIC WORKPLACE

 

On March 18, 2020, CFTC announced a “temporary change” to its work schedule policy, 

essentially implementing a maximum telework policy.22 Since that time the majority of OIG has 

worked from home, and we have not detected any decline in productivity. However, we have 

worked on site as necessary, including travel necessary for an investigation, and travel to a 

conference (also attended by CFTC employees). The Inspector General has worked on site, full 

time, throughout the pandemic. During this reporting period, the Assistant Inspector General for 

Auditing worked onsite two days each week. All OIG employees are stationed at CFTC 

headquarters in Washington, D.C. 

 CFTC began its Phase I return to work on October 4, 2021. Further reopening is 

apparently subject to collective bargaining. The OIGs are not subject to collective bargaining; 

moreover, IGs are authorized to “select, appoint, and employ” OIG staff “as may be necessary 

for carrying out the functions, powers, and duties of the [OIG].” 5 USC Appx. § 8G(b)(2). We 

interpret the IG Act to authorize separate telework policies for the OIG (that are compliant with 

applicable laws and regulations governing employment by the Agency). Currently we are 

following Agency policy. 

 

22 The Office of Personnel Management currently advises the nationwide status is “OPEN WITH MAXIMUM 

TELEWORK FLEXIBILITIES TO ALL CURRENT TELEWORK ELIGIBLE EMPLOYEES, PURSUANT TO 

DIRECTION OF AGENCY HEADS.” 
16

STRATEGIC PLAN for the OFFICE of INSPECTOR GENERAL 

MISSION, VISION, AND VALUES

Mission

Our mission is to promote integrity, efficiency, and effectiveness by promoting for 

continuous improvement in our agencies' management and program operations of the CFTC. To

accomplish our mission, we: 

• Conduct independent and objective audits, reviews, and other types of engagements of the 

CFTC programs and operations; 

• Conduct independent and objective investigations of potential criminal, civil, and 

administrative violations that could undermine the ability of the CFTC perform its mandated 

mission; 

• Conduct independent and objective reviews of regulatory economic laws under the 

jurisdiction of the CFTC programs and operations; 

• Identify maturity challenges in IT programs and make attainable recommendations to further 

mature them;

• Prevent and detect fraud, waste and abuse in CFTC programs and operations; 

• Communicate timely and efficiently with CFTC programs and operations stakeholders by 

providing quick responses with value added results; and 

• Keep agency chairperson, commissioners and Congress fully and currently informed of 

significant issues and developments.

Vision Statement 

The OIG is an independent, professional organization that contributes to the success of 

the CFTC through audits, investigations, economic analysis, and other activities, and thereby acts 

as a champion for positive change in the CFTC’s programs and operations. 

Values Statement 

We most value integrity, accuracy, accountability, effective communication, and efficient 

operations. These values are fundamental to the accomplishment of our mission and our daily 

operations. 
17

STRATEGIC GOAL 1: EVALUATE THE ECONOMIC IMPACT OF CFTC REGULATORY 

ACTIONS THROUGH LEGAL ANALYSIS, WHITE PAPERS, INSPECTIONS AND 

EVALUATIONS, MANAGEMENT REVIEWS, AND OTHER PRODUCTS

Office of Legal and Economic Research (OLER): Legislative, Economic, and Regulatory 

Review Agenda

OLER plans to continue to identify and explore areas where OIG legal and/or economic 

review might aid the CFTC in improving the economy and efficiency of its programs. OLER 

products may include white papers, management reviews, legal opinion, and other products.23

These efforts are particularly important since the CFTC is an economic regulatory agency. We 

will continue to seek staff that possesses exceptional expertise in relevant law and economics.

STRATEGIC GOAL 2: ADDRESS HIGH IMPACT ISSUES IN CFTC ADMINISTRATIVE 

AND MISSION PERFORMANCE

Office of Audits: Audit and Review Agenda

A. Introduction 

 The primary objectives of OIG’s audit and review agenda are to promote long-term 

efficiency and effectiveness in the administration and operation of the Commission and to 

protect against fraud and abuse. The agenda and priorities for OIG are determined based on the 

following factors: 

• Adequacy of internal control systems as indicated by vulnerability assessments and 

internal control reviews recommended by OMB Circular A-123; 

• Changes in the program conditions or particular vulnerability of the organization, 

program, activity, or function to problems or deficiencies;

• Current and potential dollar magnitude and likely benefits of a review on the efficiency or 

effectiveness of CFTC programs and operations;

• Management priorities and improvements that may be possible; 

• Results of audits of CFTC programs and operations by other federal agencies; and

• Availability of audit resources and the potential opportunity costs to the agency. 

 

23 As stated in the Inspector General Act, it is our duty and responsibility to continually review existing and 

proposed legislation and regulations relating to CFTC programs and operations, and to make recommendations 

concerning the impact of such legislation or regulations on the economy and efficiency in the administration of such 

programs. 5 U.S.C. App. § 4(a)(2) (made applicable to the designated federal entity IGs at 5 U.S.C. App. §8G(g)). 
18

B. Annual Audits. The following required audits are performed on an annual basis. 

Audit of CFTC Financial Statements

 In FY 2002, Congress passed the Accountability of Tax Dollars Act.24 The Act requires 

the CFTC, along with numerous other Federal entities, to have its financial statements audited 

annually. To this end, OIG has engaged a contractor to provide the audit effort required to enable 

the contractor to render an opinion on the Agency’s financial statements for each fiscal year in 

accordance with GAGAS and OMB Bulletin 19-01. 

Audit of the CFTC Customer Protection Fund 

Section 748 of the Dodd-Frank Act25 requires the Agency to submit to Congress a yearly 

report on the Commission’s whistleblower award program that includes a complete set of audited 

financial statements, including a balance sheet, income statement, and cash flow analysis. To this 

end, OIG has engaged a contractor to perform the audit. 

C. Annual Reviews. OIG will perform the following reviews and evaluations annually. 

Inspector General’s Assessment of the CFTC’s Most Serious Management and Performance 

Challenges 

The Reports Consolidation Act of 200026 requires the Inspector General to summarize the 

most serious management and performance challenges facing the CFTC and to assess the 

Agency’s progress in addressing those challenges.

Review of Compliance with the Federal Managers' Financial Integrity Act, FMFIA27

In support of OMB Circular A-123, the Inspector General will evaluate, provide technical 

assistance and advise the Agency head as to whether the Agency's review and evaluation process 

was conducted in accordance with the circular's requirements. 

Evaluation of Compliance with Federal Information Security Management Act, FISMA 

The Federal Information Security Management Act28 requires the Inspector General or 

his designee to perform annual independent evaluations of the information security program and 

practices of the Agency. This compliance may also be performed through an audit. 

 

24 See fn. 14. 25 See fn. 15. 26 P.L. 106-531, 114 Stat. 2537 (2000). 27 P.L. 97-255, 96 Stat. 814 (1982). 28 See fn. 16. 
19

D. Other Audits, Reviews, and Audit Projects; Data Analytics

OIG will focus the balance of its resources on the review of CFTC program and 

management operations (giving priority to activities relating to the most serious management 

challenges facing the CFTC), and compliance with Congressional mandates. Toward that end, 

OIG intends to increase the use of data analytics to enable audit operations. Data Analytics 

within the Office of Inspector General supports data services and analyses, and provides the 

competency to deliver short-turnaround projects that produce quick, valuable successes. Finally, 

OIG will stand ready to respond to issues and requests as they are received from Congress, the 

Agency, members of the public, or any other source. 

STRATEGIC GOAL 3: ADDRESS EMPLOYEE AND CONTRACTOR MISCONDUCT 

PROMPTLY, THOROUGHLY, AND RELIABLY

As a chain is only as strong as its weakest link, CFTC likewise depends on each and 

every employee and contractor to perform with competence, and to refrain from misconduct. 

CFTC OIG considers and investigates every credible allegation to ensure that CFTC employees 

and contractors uphold the public trust and perform their work with integrity and competence. 

Office of Investigations: Investigative Agenda 

 The Inspector General Act of 1978, as amended, provides that the Inspector General may 

receive and investigate complaints or information from the Commission's employees concerning 

the possible existence of an activity constituting a violation of law, rules or regulations; or 

mismanagement, gross waste of funds, or abuse of authority; or a substantial and specific danger 

to the public health and safety. 

CFTC is an independent regulator with a mission that does not involve grants, substantial 

contracts, or other benefits to administer, and is therefore less likely than some agencies to 

generate a substantial investigative workload. Historically, OIG has conducted only a reactive 

investigative program, chiefly relying on unsolicited complaints as the source of investigative 

leads. Allegations and complaints are received primarily from CFTC staff and management, 

CFTC ethics officials, the general public, and Congress. We also receive referrals from other law 

enforcement agencies. Should further experience show areas at CFTC on which to focus 

proactively, we will consider establishing an investigative agenda. To ensure that employee 

complaints easily reach OIG, we maintain a 24-hour hotline. The hotline phone number is (202) 

418-5510. We also maintain an email address for complaints, OIGComplaint@cftc.gov.

STRATEGIC GOAL 4: ADDRESS MINOR OPERATIONAL AND MANAGEMENT ISSUES 

PROMPTLY THROUGH THE USE OF INSPECTIONS & EVALUATIONS (I&E)

 I&E provides the Inspector General with an alternative method to conduct independent, 

credible, and thorough reviews of CFTC’s programs and operations to prevent waste, fraud and 

abuse. Through and I&E, OIG can quickly analyze CFTC concerns or issues that need immediate 

attention by using a variety of review methods and evaluation techniques. The I&E reports 

provide CFTC management with findings and practical recommendations that will assist in 

enhancing program operations, efficiency, effectiveness, and compliance with applicable policies 
20

and procedures. As stated previously, OIG conducts inspections, evaluations, and other covered 

products in accordance with the Quality Standards for Inspection and Evaluation issued by the 

CIGIE. 

RESOURCES REQUIRED

OIG estimates that approximately four staff years of effort will be devoted over each of 

the next five years to the annual audit, the annual review, and the annual evaluation described 

above. OIG estimates an additional 12 staff years of effort will be necessary over each of the 

next five years to complete the audit, investigative, I&E, and legal and economic review 

functions. OIG estimates an additional four staff years for management, administrative, and 

outreach efforts. Our estimated resource needs necessitate the growth of this office to 20 FTE

roughly over the next four years. 

Because OIG resources can be diverted at any time in order to address current issues or 

allegations, completed timely in order to be of assistance to the Agency or Congress, it is not 

possible to forecast with complete accuracy how resources will be utilized from year to year. 

CONTACTING the OFFICE of the INSPECTOR GENERAL

OIG is located at 1155 21st Street, N.W., Washington, D.C. 20581. Regular business 

hours are between 8:30 AM and 5:00 PM, Monday through Friday, except federal holidays. Our

general telephone number is (202)418-5110. Our facsimile number is (202)418-5522. Our email 

address for general questions and discussion is OIG@cftc.gov. 

Our email for complaints is OIGComplaint@cftc.gov. The hotline phone number is 

(202)418-5510. OIG’s web page, with a link to the OIG online complaint form, is located at

http://www.cftc.gov/About/OfficeoftheInspectorGeneral/index.htm. 
21

APPENDICES 

Appendix 1 – Reports Issued with Questioned Costs

April 1, 2022 – September 30, 2022 

Dollar Value

Thousands

Number Questioned Unsupported

A. For which no management decision has 

been made by the commencement of the 

reporting period 0 0 0

B. Which were issued during the reporting 

period 0 0 0

Subtotals (A + B) 0 0 0

C. For which a management decision was 

made during the reporting period 0 0 0

( I ) dollar value of 

disallowed costs 0 0 0

( ii ) dollar value of costs not 

disallowed 0 0 0

D. For which no management decision

has been made by the end of the 

reporting period 0 0 0
22

Appendix 2 – Reports Issued with Recommendations That Funds Be 

Put to Better Use

April 1, 2022 – September 30, 2022

 Dollar Value

Number Thousands

A. For which no management decision has 

been made by the commencement of the 

reporting period 0 0

B. Which were issued during the reporting 

period 0 0

Subtotals (A + B) 0 0

C. For which a management decision was 

made during the reporting period 0 0

( i ) dollar value of 

recommendations that

were agreed to by management

0 0

( ii ) dollar value of 

recommendations that

were not agreed to by 

management 0 0

D. For which no management decision

has been made by the end of the 

reporting period 0 0
23

Appendix 3 - Index of IG Act Reporting Requirements

Section 4(a)(2) Review of legislation and regulations...............................................13

Section 5(a)(1) Significant problems, abuses and deficiencies.....................................8

Section 5(a)(2) Recommendations with respect to significant problems............................8

Section 5(a)(3) Significant recommendations that have not been completed...................9

Section 5(a)(4) Matters referred to prosecutorial authorities....................................13

Section 5(a)(5) Summary of instances where information was refused ..........................5

Section 5(a)(6) Completed audit reports...............................................................8

Section 5(a)(7) Significant audit reports..............................................................8

Section 5(a)(8) Statistical Table—Questioned Costs.............................................21

Section 5(a)(9) Statistical Table—Funds Recommended for Better Use ......................22

Section 5(a)(10) Audit reports lacking management decision .....................................9

Section 5(a)(10) Audit reports without Commission response after 60 days....................9

Section 5(a)(10) Audit reports for which there are any outstanding unimplemented 

recommendations, including the aggregate potential cost savings ...........9

Section 5(a)(11) Significant revised management decisions .......................................9

Section 5(a)(12) Significant management decisions where the IG disagrees....................9

Section 5(a)(13) Information described under § 804(b) of the Federal Financial 

Management Improvement Act of 1996 .....................................N/A 

Section 5(a)(14)-(16) Peer Review information ........................................................14

Section 5(a)(17) Statistical tables for investigations.............................................12

Section 5(a)(18) Description of metrics used to develop the statistical tables for 

investigations......................................................................12

Section 5(a)(19) Report on each investigation involving a senior Government employee 

where allegations of misconduct were substantiated .........................13

Section 5(a)(20) Whistleblower retaliation findings ..............................................13

Section 5(a)(21) Attempts to interfere with OIG independence .................................7

Section 5(a)(22) Summary of final reports not made public.....................................16

Section 6(b)(2) Summary of reports to Chairman where assistance was refused.............7