Citadel Pushes for SEC Oversight of Event Contracts Linked to Public Companies

Citadel Securities has asked US regulators to reaffirm the SEC's primary oversight of event contracts linked to public companies and their securities.

The submission, made on September 9, was in response to a joint SEC-CFTC consultation on defining 'swap' and 'security-based swap', which could determine which regulator supervises certain equity-linked prediction-market products.

Citadel argued that contracts tied to company key performance indicators (KPIs) may constitute security-based swaps, and warned that the CFTC's self-certification process could be used to bypass SEC jurisdiction.

The dispute concerns regulatory routing as much as product design. If the SEC is the primary regulator, Citadel's position is that contracts should remain subject to its oversight and surveillance framework; if products can be listed through the CFTC path without that determination, the firm says the SEC's jurisdiction could be avoided.