The Commodities Futures Trading Commission oversees a federal program to provide reparations to customers who suffer losses in commodities futures trading due to violations of the Commodities Exchange Act or regulations of the Commission. To obtain reparations, the customer must show that losses occurred due to violations of the law or regulations by professionals in the commodities futures industry who are registered under the Commodity Exchange Act. Such registered professionals include brokers, advisors, floor traders, and commodity pool operators.

Reparation complaints must be filed by delivery or mail to the Commission within two years of the date when a commodities trading customer or investor knew or should have known of wrongdoing by a commodities professional that resulted in loss for the customer. Three types of reparation proceedings are available:

1. Voluntary proceedings in which each party agrees to participate with the understanding that no hearings or appeals will be provided. The customer must include a $50 filing fee with the complaint mailed or delivered to the Commission. The customer's case will be decided by a Judgment Officer through review of written submissions and exhibits from the parties. It is expected that a voluntary proceeding will resolve customer claims quickly and inexpensively. There is no dollar limit on the size of the claim that may be resolved through a voluntary proceeding.
   
2. Summary proceedings in which claims of $30,000 or less are decided. The customer must include a $125 filing fee with the claim. A Judgment Officer may conduct hearings by telephone before issuing an initial decision. The initial decision should contain findings of fact and conclusions of law, and it is appealable. An appeal may be made to the Commission, and the resulting decision of the Commission may be appealed further to a U.S. Court of Appeals.
   
3. Formal proceedings in which claims greater than $30,000 are decided. A filing fee of $250 must be submitted by the customer with the claim. Formal proceedings are held before an Administrative Law Judge and include in-person hearings. Initial decisions are provided that contain findings of fact and conclusions of law. Such initial decisions may be appealed to the Commission and to a federal court of appeals.

Customers may seek reparation of their actual damages, including out-of-pocket trading losses. Punitive damages may be awarded in cases of intentional violations of law or regulation if the violations take place in the execution of an order on the floor of an exchange. Customers with successful claims also may recover their filing fees. Prejudgment interest and necessary litigation costs such as fees for experts may be awarded to customers who successfully file summary or formal proceedings. However, prejudgment interest is not available for the customer who prevails in a voluntary proceeding.

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