From: Riley, John <JRiley@CFTC.

gov>
Sent: Wednesday, March 3,20107:46 PM
To: Riley, John <JRiley@CFTC.gov>; Katz, Deborah (Banking)
<Deborah_Katz@banking.senate.gov>; Chon, Julie (Banking)
<Julie_Chon@banking.senate.gov>
Cc: Leslie, Douglass <dleslie@CFTC.gov>; Arbit, Terry <tarbit@CFTC.gov>; Miller,
Jonathan (Banking) <Jonathan_Miller@banking.senate.gov>; Graham Rea, Lynsey
(Banking) <Lynsey_GrahamRea@banking.senate.gov>; Galicia, Catherine
(Banking) <Catherine_Galicia@banking.senate.gov>
Subject: RE: CFTC Staff Technical Assistance Feb 21 Package 1-- CFPA

Deborah,

As on first blush, your provision below looks very good. Thank you so much for addressing this.

That said, Commission staff would ask about a potentially unintended consequence of the proposed language.
Using the wording "any person that is registered, or required to be registered, with the [CFTC]," the definition
would not appear to cover firms that have received an exemption from registration by the CFTC.

For instance, foreign firms that want to offer and sell foreign futures and options traded on a foreign exchange
to U.s. customers are subjected to certain regulatory requirements under Part 30 of the CFTC's regulations (17
CFR Sec. 30.1, et seq.). These regulations include a registration requirement, as well as various other
requirements relating to risk disclosure, record keeping and reporting, capital, and protection of customer
funds.

But the CFTC may grant a foreign firm an exemption from registration and other requirements if the CFTC
determines that, among other things, the foreign firm is subject to comparable regulatory oversight by its home
country regulator. CFTC Orders granting such exemptions, though, typically make clear that the exemption does
not cover the CFTC's anti-fraud provisions. (If you would like to look at an example of a "Part 30 Exemptive
Order," the CFTC issued one to the Tokyo Financial Exchange in October 2008, which can be found at 73 Fed Reg
60625).

Please forgive that lengthy background, but it leads to our question: Since such exempt firms are not required
to be registered with the CFTC, under the revised language, it appears that the CFPA Act could apply to them. In
that event, what impact (if any) would there be on the CFTC's ability to impose any of the requirements in Part
30 - and/or on the CFTC's ability to bring an enforcement action for fraud? Our expectation is that the CFPA
would not be focusing heavily on foreign futures firms, but we would be interested to hear your thoughts on
whether the application of the CFPA Act to such firms that are exempt from registration could affect the CFTC's
authorities in this area. If it would be easier to discuss the issue by phone, we will be happy to make ourselves
available at your convenience.

Again, I want to emphasize that relatively speaking, this is viewed as a minor issue. In general, Commission staff
regards the new language you have proposed as very helpful and appreciates your efforts on this.

Thank you.

John

CFTC-CREW-0247
From: Riley, John
Sent: Wednesday, February 24,20109:57 AM
To: 'Katz, Deborah (Banking)'; Chon, Julie (Banking)
Cc: Leslie, Douglass; Arbit, Terry; Miller, Jonathan (Banking); Graham Rea, Lynsey (Banking); Galicia, Catherine
(Banking)
Subject: RE: CFTC Staff Technical Assistance Feb 21 Package 1-- CFPA

Deborah -

Thanks for sharing this. At first blush it looks good but General Counsel's office may have some more detailed
comment which I hope to pass on to you shortly.

Thanks so much for your willingness to address the concern.

John

From: Katz, Deborah (Banking) [mailto:Deborah_Katz@banking.senate.gov]

Sent: Tuesday, February 23, 2010 7:35 PM
To: Riley, John; Chon, Julie (Banking)
Cc: Leslie, Douglass; Arbit, Terry; Miller, Jonathan (Banking); Graham Rea, Lynsey (Banking); Galicia, Catherine
(Banking)
Subject: RE: CFTC Staff Technical Assistance Feb 21 Package 1-- CFPA

John,

Does the following language address your concerns? It is very similar to your option a. Is there a difference
between your wording (persons subject to the jurisdiction of the CFTC) and this wording (persons registered or
required to be registered with the CFTC)?

Thanks,
Deborah

"(21) PERSON REGULATED BY THE COMMODITY FUTURES TRADING COMMISSION.-The term "person
regulated by the Commodity Futures Trading Commission" means any person that is
registered, or required to be registered, with the Commodity Futures Trading
Commission, but only to the extent that such person's activities are subject to the
jurisdiction of the Commodity Futures Trading Commission under the Commodity Exchange
Act. "

From: Riley, John [mailto:JRiley@CFTC.gov]

Sent: Sunday, February 21, 2010 10:32 AM
To: Chon, Julie (Banking); Katz, Deborah (Banking)
Cc: Leslie, Douglass; Arbit, Terry
Subject: CFTC Staff Technical Assistance Feb 21 Package 1-- CFPA

CFTC-CREW-0248
Julie and Deborah -

The attached consists of CFTC staff comments provided as technical assistance with respect to the CFP A.
Thank you very much for your time on Friday and your willingness to review and consider the comments of the
Commission's staff.

Please do not hesitate to let me know if you have any questions of if we can be of assistance in any way.

John

John P. Riley
Director of Legis1ative Affairs
Office ofthe Chairman
u.s. Connnodity Futures Trading Connnission
115521 51 St., NW
Washington, DC 20581
(202) 418-5383
llijl~Y@~J~I~,gQY

CFTC-CREW-0249