CFTC and FCA Sign Fintech Collaboration Agreement - The Industry Spread

Michael Volpe

After spending a decade in finance, Michael Volpe has been a freelance investigative journalist since 2009. His work has been published locally in the Chicago Reader, Chicago Crusader, Chicago Heights Patch, and New City. Nationally, Volpe's work has appeared in a wide variety of publications including the Washington Examiner, the Daily Caller, Crime Magazine, the Southern Christian Leadership Conference Newsletter, and Counter Punch. Volpe has been recognized by whistleblowers as leading the charge in getting their stories out. His first book Prosecutors Gone Wild was published in October 2012, his second book The Definitive Dossier of PTSD in Whistleblowers was published in February 2013 and his third book Bullied to Death was published in August 2015.

CFTC and FCA Sign Fintech Collaboration Agreement

February 20, 2018

The Commodities Futures Trading Commission (CFTC) in the USA and Britain’s Financial Conduct Authority (FCA) have signed a collaborative agreement on fintech. The two cross-continental regulators recently set up individual fintech initiatives, LabCFTC and FCA Innovate.

CFTC and FCA Sign Fintech Collaboration AgreementCFTC spoofingThe FCA launched FCA Innovate in February 2014, while LabCFTC was first announced in May 2017.

According to the CFTC press release:

The US Commodity Futures Trading Commission and the UK’s Financial Conduct Authority have today signed an arrangement that commits the regulators to collaborating and supporting innovative firms through each other’s financial technology (FinTech) initiatives – LabCFTC and FCA Innovate.

J. Chris Giancarlo – CFTC Chairman

Commenting on the agreement, CFTC Chairman J. Christopher Giancarlo said:

The FCA’s Project Innovate is the gold standard for thoughtful regulatory engagement with emerging technological innovation. Therefore, I am delighted to join Andrew Bailey in this arrangement to demonstrate our cross-Atlantic commitment to facilitating market-enhancing innovation and sharing best practices in FinTech engagement. This is the first FinTech innovation arrangement for the CFTC with a non-US counterpart. We believe that by collaborating with the best-in-class FCA FinTech team, the CFTC can contribute to the growing awareness of the critical role of regulators in 21st century digital markets. Our LabCFTC FinTech effort grew out of a bipartisan commitment to innovation, and I thank my fellow CFTC Commissioners Brian Quintenz and Russ Behnam for their continued leadership on these issues.

In a separate press release, the FCA noted:

The Cooperation Arrangement on Financial Technology Innovation (FinTech Arrangement) focuses on information-sharing regarding FinTech market trends and developments. It also facilitates referrals of FinTech companies interested in entering the others’ market, and sharing information and insight derived from each authority’s relevant sandbox, proof of concept, or innovation competitions.

The Fintech Arrangement follows the creation of FCA Innovate in October 2014 and LabCFTC in May 2017. Among other activities, these initiatives were set up to help businesses with innovative ideas navigate the regulatory landscape and engage with the regulator. To date, the FCA’s Innovation Hub has supported over 500 businesses and the authorization of 43 businesses. LabCFTC has engaged with over 150 entities since its launch last year, published its first primer on the topic of virtual currencies, and soon will seek public feedback on a planned 2018 innovation competition.

Andrew Bailey, Chief Executive of the FCA, commented:

International borders shouldn’t act as a barrier to innovation and competition in financial services and that is why agreements like the one we have signed today with the CFTC, a forward looking and proactive regulator, are so important.  As our first agreement of this kind with a US regulator, we look forward to working with LabCFTC in assisting firms, both here in the UK and in the US, who want to scale and expand internationally in our respective markets. As part of the Arrangement, the FCA and the CFTC will be hosting a joint event in London to demonstrate how firms can engage with both regulators.

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