A Three‑Decade Rule Comes to an End
The U.S. Commodity Futures Trading Commission (CFTC) has formally scrapped its “neither admit nor deny” policy, which had been in place since 1998. Under the rule, defendants were barred from publicly denying the agency’s allegations if they wanted to reach a settlement. While the policy was originally designed to cement finality in enforcement actions, it increasingly drew criticism for creating a perception that regulators were shielding themselves from scrutiny.
CFTC Chairman Mike Selig said the decision was driven by the concern that the policy could give the impression the commission was trying to suppress criticism. “For nearly three decades, the CFTC refused to settle unless defendants promised not to contest the charges publicly. That kind of rigidity might have served the commission’s interests in the short run, but it risked undermining the agency’s credibility,” Selig explained. By eliminating the requirement, the CFTC aims to demonstrate that it is open to public debate and willing to be held accountable.
Synchronizing with the SEC, Crypto’s Free‑Speech Fights, and the Gemini Twist
The move brings the CFTC in line with other federal watchdogs—most notably the Securities and Exchange Commission (SEC), which phased out a similar “neither admit nor deny” clause in May. For the crypto industry, the change carries extra weight. Several digital‑asset firms that had previously settled CFTC actions had long complained that the policy effectively gagged them, preventing companies from mounting any public defense after paying hefty penalties. They argued that such silence distorted market information and left investors in the dark about the true nature of the regulatory disputes.
Going forward, the CFTC said settlement negotiations will be more flexible. While a blanket prohibition on denial is gone, the commission retains the right to require defendants to acknowledge specific facts or legal liabilities on a case‑by‑case basis. This balanced approach is meant to preserve the enforcement agency’s ability to hold wrongdoers accountable while giving settling parties room to speak and restore their reputations.
In a parallel development that underscored the day’s reformist tone, the CFTC also moved to withdraw a $5 million settlement it had earlier reached with crypto exchange Gemini. Chairman Selig bluntly described the Gemini case as “politically targeted,” hinting that earlier settlement deliberations may have been improperly influenced. The rare step, announced on the same day as the policy repeal, has intensified discussions about the CFTC’s enforcement independence and echoes the broader message of the shift: regulatory actions should be grounded in law, not politics.