CFTC Tightens Wells Process: Transparency and Fairness Take Center Stage

Legal Alert
By Paul B. Turner
December 3, 2025

The Commodity Futures Trading Commission (CFTC) has announced significant changes to its enforcement procedures designed to inject greater transparency and fairness into the early stages of investigations. Acting Chairman Caroline D. Pham unveiled these amendments on December 1, 2025, targeting two critical areas: the Wells process and internal enforcement recommendations.

These updates—effective December 3, 2025—are procedural, not rule changes under the Administrative Procedure Act. But they will reshape how targets and counsel navigate CFTC investigations.

What’s New?

1. Wells Notices and Submissions (Part 11, Appendix A)

The Wells process gets a meaningful upgrade:

• Clearer, evidence-based notices. Written Wells notices (or written confirmation of oral notices) must now identify the specific charges staff intends to recommend—backed by citations to supporting evidence.
• More time to respond. The minimum response window expands from 14 days to 30 days, giving targets a better opportunity to craft a substantive reply.
• Guardrails on accelerated deadlines. Shortened timelines will require good cause and formal approvals—reducing arbitrary compression.
• Direct access to the Commission. Wells submissions will now be forwarded to the Commission automatically, rather than only upon request.

2. Enforcement Recommendation Memoranda (Part 10)

The CFTC is raising the bar for internal recommendation memos:

• Objectivity and professional discipline. Memos must be comprehensive, neutral, and consistent with professional-conduct standards.
• Evidence and law front and center. Recommendations must cite supporting facts and legal authority—not just conclusions.
• Address adverse facts and precedent. Unfavorable facts and contrary case law must be acknowledged and distinguished.

Why It Matters

These changes alter the dynamics of early-stage enforcement:

• Better notice, better defense. Clearer charges and evidence give targets a real chance to engage meaningfully.
• Strategic use of extra time. The 30-day floor allows deeper preparation—record preservation, witness prep where appropriate, narrative development, and legal analysis (including adverse facts).
• Impact on settlement timing. More disciplined internal memos may change negotiation pacing while improving process fairness.

Practical Takeaways

• Use the time: Extra days matter only if you build a plan and execute early.
• Match the rigor: Expect better-supported allegations; respond at the same level of detail.
• Assume visibility: Submissions will reach the Commission—write accordingly.