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-----Original Message-----
From: cb [mailto:cpbow@xxxxxxxxxxxxx]
Sent: Sunday, May 09, 1999 10:55 AM
To: Roger D. Rines
Cc: Omega-List@xxxxxxx Com; RealTraders Discussion Group
Subject: Re: CFTC Case Update
[ big snip ]
|
| My opinion is that the CFTC/NFA shouldn't regulate what writers
say, but
| should include a much more illustrative brochure on the hazards of
| trading. I know that all but a few of the newest traders on this
list
| know the risks and know much better than i the steps to take to
minimize
|
| If you are not interested in this subject I apologize for wasting
your
| time. But if you have an opinion, I'd be interested: what
*should* the
| regulators be doing -if anything - about the misleading courses
sold to
| the public?
[ another big snip ]
| Conrad Bowers
>From the perspective of one of the plaintiffs in the case, I
interpreted the CFTC rule expansion as an abdication of
responsibility. Their rule changes to restrict all unregistered
speech about all commodities in and on all media was a lazy attempt
to curb the fraud that goes on in the commodity industry.
It seemed that if they could get everyone to fall under the umbrella
of a CTA, then that alone would filter out the felons. By being
registered as a CTA, you immediately become subject to NFA/CFTC
audits. These audits would allow them to have unrestrictive access
to all of the registered person's information whenever they want, as
often as they want and without the need for a search warrant. This
would make the job of finding and stopping fraud easier.
While their motives might have been good, their approach of licensing
all commodity speech was a cure that was worse than the disease.
Failure to comply with their rules would immediately subject
unregistered people involved in commodity discussions to a $500K fine
and possible jail time. It wouldn't take many CFTC prosecutions
before their enforcement actions would chill speech. For sure those
who understood how to be successful with trading and had the most to
loose would be the least likely to say anything. Not the best way to
keep the industry viable, expanding and healthy.
Another aspect of the rule changes that made no sense was the lack of
any qualitative measures for those who would be registered. This
said they will license speech but the performance of the people won't
change. With licensed speech they just won't need to work so hard to
find the crooks. The new rules they were trying to enforce and those
already in place now don't go to the heart of the matter of fixing
what is not working well. If they win this case the problem areas
won't change. In some respect, their underlying strategy was to
expand their revenue base without implementing any real improvements.
If they were a management team of a "for-profit" company they would
be fired by the board. Their actions were no different than what
some people do in dealing with difficult situations by using creative
accounting.
If you listen to the CFTC, you'll hear their motives are defended by
a CEA mandate to remove fraud. However, fraud has always been
illegal and there are plenty of laws already that allow them to
remove it. It doesn't take rocket science to understand who is
malignantly using smoke and mirrors. If they aren't up to speed on
illusions they could just ask some of the walking wounded on these
mailing list for ideas. Imagine only being able to buy books from
licensed writers. Why then should they want to take away free speech
rights of all interested people to achieve that goal?
What could be different:
I believe fraud is another form of violence which explodes a
dreamer's current path and shouldn't be tolerated. However, the
government shouldn't be triggering neutron measures that kill entire
communities in order to eliminate infections.
The CFTC's next move, if they get stopped with their current terror
campaign, should be to look at fraud differently and get more
involved in understanding how people use information. An example
would be to talk to those who are using it. In other words, change
their operating paradigm from that of a control center to that of a
service center.
Once they have a users perspective, they will know where to go to
stop the problem behaviors. They will also understand the importance
of education and easy access to information in limiting the damage
fraud can inflict on the uneducated. They will also be able to
understand the problems that registered people create and be able to
stop them in a positive manner.
With the expansion in web participants, the ability that dishonorable
entities had to hide is coming to an end. Virtual communities have
the ability to expose even the most slippery of characters. If
someone causes damage these days, it can be everywhere in a matter of
minutes. This kind of protection is priceless and should be defended
with everything we can muster for it is a protection the government
will never be able to provide.
This opinion is just mine and may not represent what others in the
action were thinking.
Roger...
mailto:rdrines@xxxxxxxxxxx
|