What the CFTC has published on AI, and what it asks of firms

The Commodity Futures Trading Commission's documents on artificial intelligence are a 2024 staff request for comment, a customer advisory on AI scams, and a December 2024 staff advisory whose message is that the existing Commodity Exchange Act and CFTC regulations apply whether or not a firm uses AI.¹²⁴ None of the three is a rule: the advisory says it creates no new binding rules or regulations.⁴ This page sets out what those documents say, in their order, with the parts that touch finance and reporting work.

January 2024: the request for comment

On 2024-01-25 four CFTC divisions and its Office of Technology Innovation issued a request for comment on "the current and potential uses and risks of artificial intelligence (AI) in the derivatives markets the CFTC regulates."¹ The release said the request sought comment on the definition of AI and its uses in trading, risk management, compliance, cybersecurity, recordkeeping, data processing and analytics, and customer interactions.¹ It also asked about risks: market manipulation and fraud, governance, explainability, data quality, concentration, bias, privacy and confidentiality, and customer protection.¹

The release said staff would use the responses in analyzing possible future actions, "such as new or amended guidance, interpretations, policy statements, or regulations."¹ Comments were accepted until 2024-04-24.¹

January 2024: the customer advisory on AI scams

The same day, the CFTC's Office of Customer Education and Outreach issued a customer advisory titled "AI Won't Turn Trading Bots into Money Machines."² The release said scammers were claiming that bots, trade signal algorithms, crypto-asset arbitrage algorithms and other AI-assisted technology could generate huge returns, and that the advisory warns that claims of high or guaranteed returns are red flags of fraud.² The advisory itself says: "AI technology can't predict the future or sudden market changes."² It is addressed to the public, not to firms.

December 2024: the staff advisory

On 2024-12-05 the Divisions of Clearing and Risk, Data, Market Oversight, and the Market Participants Division issued CFTC Letter No. 24-17, a staff advisory to registered entities and registrants.³⁴ The press release said it "reminds CFTC-regulated entities of their obligations under the Commodity Exchange Act and the CFTC's regulations as these entities begin to implement AI," and that it was informed in part by the comments on the January request.³

The letter is explicit about what it is not. It says it "is not a compliance checklist or substitute for appropriate risk assessments or governance," and that it is not intended to create enforceable rights or new binding rules.⁴ It represents the views of the four divisions, not necessarily the Commission's.⁴ Staff wrote that it expects regulated entities to "assess the risks of using AI and update policies, procedures, controls, and systems, as appropriate."⁴

The advisory then walks through existing requirements by type of firm.⁴

• Exchanges, swap execution facilities and swap data repositories. Uses in order processing, trade matching and market surveillance, and system safeguards whether a tool is built in house or bought from a third party.
• Clearing organizations. System safeguards, member assessment, and settlement, where staff said AI might be used to validate data, find anomalies before settlement or identify failed trades. Staff noted that a clearing organization keeps responsibility when it outsources.
• Intermediaries and other registrants. Risk management, such as margin calculation for uncleared swaps; compliance and recordkeeping; and customer protection, including the segregation of customer funds.

The parts closest to finance work

Two passages speak to reporting and accounting. On recordkeeping and reporting, staff said AI "may support the accuracy and timeliness of financial information and risk disclosures" provided to the Commission, the National Futures Association and customers, and reminded registrants that they remain responsible for those disclosures meeting the requirements.⁴ Its example: a commodity pool operator that used generative AI to update a disclosure document or prepare periodic account statements would still be subject to all of Part 4 of the regulations.⁴

On customer funds, staff said a futures commission merchant that uses AI to account for segregated funds "would still be required to ensure" that the requirements of Part 1 are met.⁴ Staff added that it may make AI a topic in routine oversight such as examinations and will keep evaluating the need for future regulation or guidance.⁴

What this means for the record

The staff advisory is addressed to CFTC-registered entities and registrants, the firms in the derivatives markets, not to public companies in general.⁴ For companies that file with the SEC, the closest parallels are in the SEC's own releases and in the filings this site logs. The CFTC's two documents are also listed, dated, on the CFTC tracker page.