In a press release strangely devoid of any mention of anyone being victimized or defrauded, the U.S. Commodity Futures Trading Commission (CFTC) announces it is suing Intrade, the famous "prediction market" business, based in Ireland.

From that release:

Intrade and TEN [the corporate parent] allegedly unlawfully solicited and permitted U.S. customers to buy and sell options predicting whether specific future events would occur, including whether certain U.S. economic numbers or the prices of gold and currencies would reach a certain level by a certain future date, and whether specific acts of war would occur by a certain future date. The CFTC's complaint also charges Intrade and TEN with knowingly filing false "Annual Certification" forms with the CFTC stating that Intrade limited its options offerings to eligible market participants. Contrary to these representations, the complaint alleges that Intrade unlawfully solicited and permitted retail U.S. customers to buy and sell off-exchange options on the website. In addition, the complaint alleges that TEN violated an order issued by the CFTC in 2005 that found that TEN had previously engaged in similar conduct and ordered TEN to cease and desist from violating the Commodity Exchange Act and CFTC regulations, as charged.

And CFTC wants to get, from this Irish company for violating this American regulatory agency's diktats by actually allowing U.S. citizens a harmless liberty that their government wants to bar them from:

civil monetary penalties, disgorgement of ill-gotten gains, and permanent injunctions against further violations of federal commodities law, as charged, among other relief.

Intrade, with whom I have never done business, reportedly asks its customers to insist it is legal for them to participate, though you apparently can't use a U.S.-based credit card to do so.

And why the goddamn hell is it the CFTC's business? From the release:

David Meister, the Director of the CFTC's Division of Enforcement, stated: "It is against the law to solicit U.S. persons to buy and sell commodity options, even if they are called 'prediction' contracts, unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt. The requirement for on-exchange trading is important for a number of reasons, including that it enables the CFTC to police market activity and protect market integrity. Today's action should make it clear that we will intervene in the 'prediction' markets, wherever they may be based…

"Wherever they may be based." Why do they hate us? Whoever they are. Again, note the lack of any claim any U.S. citizen or other person has been robbed or cheated. Meister basically is saying, we are doing this bullshit so that all the world may know we can and we will throw our weight around doing exactly this sort of bullshit! And, uh, "market integrity" except for the integrity of this market U.S. citizens want to participate in, which we are interfering with rather than assuring.

Economist Bryan Caplan loves Intrade and thinks this suit shows the CFTC's true–useless–colors:

The CFTC's real complaint is that consumers eagerly bet on Intrade because the company exemplifies market integrity: "I trust Intrade with my money because of their reputation, not government regulation." Reputation: That's the same mechanism, of course, that underlies eBay, Amazon Marketplace, and the whole cornucopia of internet commerce that the mainstream information economist of 1990 would have dismissed as free-market Fantasy Island. If the CFTC really wants to protect market integrity, it should start by publicly admitting that if the CFTC ever served a useful function, that time has long since passed. Americans send money to Intrade because Intrade delivers the goods (and produces the positive externality of accurate forecasts in the process!). In the information age, firms' reputations are just a click away. That's all the protection any consumer needs. The only people the CFTC is "protecting" are their own obsolete employees.

The press release, by the way, lists the specific names of the specific obsolete employees responsible for the case, and may they all be ashamed of themselves.

Reason on Intrade.