Securities Regulation Daily Wrap Up, ENFORCEMENT—N.D. Tex.: Federal court rules CFTC has regulatory authority over gold and silver trading, (Aug 6, 2026)

By Lene Powell, J.D.

The CFTC’s authorizing statute provides jurisdiction over “commodities traded on exchanges” which includes gold and silver.

The CFTC has authority to regulate gold and silver trading, a Texas federal district court concluded in allowing a CFTC enforcement action to proceed against a precious metals dealer. The court refined a previous ruling upon further consideration of Fifth Circuit precedent. However, the court noted that the major questions doctrine could alter the analysis if adopted by the Fifth Circuit (CFTC v. TMTE, Inc., No. 3:20-cv-02910-X (N.D. Tex. Aug. 3, 2026)).

The court did not delve into the distinction between spot versus derivatives trading, which in the past has raised disputes as to CFTC jurisdiction.

Alleged precious metals fraud. In 2020, the CFTC and 30 state securities regulators sued precious metals dealers in the federal Northern District of Texas for allegedly fraudulently overpricing gold and silver bullion to vulnerable elderly persons with little experience in precious metals.

The complaint alleged that the dealers deceived at least 1300 customers into purchasing precious metals bullion at 100 percent to more than 300 percent over the prevailing market price. As alleged, nearly every customer lost the vast majority of their funds deposited with the defendants.

2025 decision. Last year, the district court decided it could not resolve at the summary judgment stage whether the CFTC had authority to regulate the transactions at issue. The Commodity Exchange Act (CEA) generally gives the CFTC jurisdiction over an enumerated list of commodities plus “all other goods and articles... in which contracts for future delivery are presently or in the future dealt in.”

The court determined that the catch-all did not include gold and silver bullion. But the court noted that the parties had not submitted briefing on other provisions that might apply, including a section that specifically mentions gold and silver bullion and another concerning certain retail transactions. Accordingly, the decision did not resolve the “thorny legal question” of CFTC authority over gold and silver trading.

Reconsideration. In a new decision following motions for reconsideration, the court decided that a Fifth Circuit decision from 1978 provides binding precedent that the CFTC does have authority to regulate gold and silver trading. In CFTC v. Muller, the Fifth Circuit concluded that the CFTC has jurisdiction over all commodity option transactions, including those on “hard commodities” like gold, silver and other metals.

Given that precedent, the court revisited the CEA section providing jurisdiction over “all other goods and articles” after a list of agricultural products. Applying textualism and originalism, the court determined that this would include gold and silver.

The court then examined the catchall phrase via the canons of noscitur a sociis and ejusdem generis, which direct attention to the surrounding context. Here, the context was agricultural products, so gold and silver should not be considered part of “all other goods and articles.”

The court next looked to the preamble to the CEA as amended in 1974, which reads that the purpose is “to amend the Commodity Exchange Act to strengthen the regulation of futures trading, to bring all agricultural and other commodities traded on exchanges under regulation.” Gold and silver were both traded on exchanges in 1974, so they were included. Further, evidence showed that Americans viewed gold and silver as commodities in public documents when Congress enacted and amended the CEA.

Major questions doctrine. Having determined that the CEA does grant the CFTC jurisdiction over gold and silver trading, the court cautioned that this conclusion could be altered if the Fifth Circuit adopts the major questions doctrine put forth by the Supreme Court.

According to the court, the Fifth Circuit has identified three indicators that each independently trigger the doctrine:

1. When the agency claims the power to resolve a matter of great political significance;

2. When the agency seeks to regulate a significant portion of the American economy or require billions of dollars in spending by private persons or entities; and

3. When an agency seeks to intrude into an area that is the particular domain of state law.

Major questions scrutiny was implicated here because the statutory text gives the CFTC power to regulate a significant portion of the American economy. The court noted that the value of U.S. mineral production rose to $112 billion in 2025 and mineral-reliant industries in the United States represent $4.09 trillion—more than one-eighth of the U.S. economy.

But the court did not come to a definitive conclusion on the major questions issue. For one thing, the Fifth Circuit could decide that the CFTC did not sufficiently exercise this authority since the 1970s to evade invalidation.

Also, there is ambiguity as to the doctrine itself. Supreme Court justices have differed on whether the major questions doctrine is “one interpretative tool among many” or a clear statement rule. Justice Barrett has taken the approach that it is a common-sense lens, but Justice Gorsuch has viewed it as a substantive rule requiring Congress to use a clear statement when granting an agency power to regulate broad swaths of the American economy.

Set for trial. Having confirmed the CFTC’s jurisdiction over the transactions, the court denied summary judgment due to factual disputes over the nature of the products, availability of markups, customer sophistication, and disclosures. The court set the matter for trial on March 1, 2027.

This is case No. 3:20-cv-02910-X.

Attorneys: Timothy James Mulreany for the CFTC. Heath Enix Hyde (Law Office of Heath Hyde) for TMTE Inc. a/k/a Metals.com.

Companies: TMTE Inc. a/k/a Metals.com

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