Proactive Compliance, Strategic Defense: Leveraging Compliance Programs To Mitigate Regulatory Enforcement Risk

This client alert synthesizes key takeaways for structuring compliance programs for entities that are subject to the enforcement authority of multiple regulatory agencies—in particular, the Commodity Futures Trading Commission (CFTC), the Department of Justice (DOJ), and the Federal Energy Regulatory Commission (FERC). While enforcement priorities may change under different administrations, recent enforcement actions and agency guidance underscore the importance of a well-structured compliance program, not only to identify and prevent misconduct, but also to mitigate the consequences of enforcement actions in the event of alleged or actual violations. Crucially, in an enforcement posture, the CFTC, FERC, and DOJ penalty guidelines all expressly consider effective compliance programs as a factor in determining the consequences for a violation.