WASHINGTON, D.C.— Better Markets filed a comment letter with the Commodity Futures Trading Commission (CFTC) in response to a proposed rule requiring futures commission merchants (FCMs), swap dealers, and major swap participants to establish, document, implement, and maintain an Operational Resilience Framework (ORF).

Why It Matters: The recent surge in cyberattacks, with significant breaches like those at AT&T and ION Group, has laid bare the vulnerabilities in our financial sector. These incidents underscore that robust cybersecurity is essential to the stability and integrity of our markets. The CFTC’s proposed rule leverages insights from past global economic events, such as Brexit and the pandemic, and provides an operational resilience framework for swap dealers and FCMs that takes steps towards making an environment that can swiftly adapt and respond to threats.

What We Said: The CFTC’s leaning towards substituted compliance raises concerns. It’s problematic for foreign entities to meet U.S. standards through substituted compliance, particularly in vital areas like cybersecurity. Therefore, it is essential the Commision prevents foreign firms from selecting weaker laws under the guise of compliance with U.S. standards.

The Bottom Line: To truly protect our financial markets, we must ensure that all firms, domestic and international, adhere to the highest standards of operational and cybersecurity resilience. Although the CFTC’s proposed rule is an important step, key changes should be made.

You can read our full public comment letter here.