“The information detailed below is taken from an online survey of current NFA registered Introducing Brokers (IBs) conducted in July 2012. The survey contained a series of questions ranging from operational preferences to the effects of recent devastations as a result of the MF Global, Inc., (MFG) and the Peregrine Financial, Inc., (PFG) failures on the IB community.” » View Full PDF, Courtesy of CME Group...

Notice to Members I-12-21 September 14, 2012 Chief Compliance Officer Requirements Become Effective for Certain FCMs on October 1, 2012 Effective October 1, 2012, FCMs that are currently regulated by a U.S. prudential regulator or that are also in some capacity registrants of the Securities and Exchange Commission must have a designated Chief Compliance Officer (CCO) under CFTC Regulation 3.3, and that person must also be a listed principal of the firm. In addition, those FCMs will be required to file the CCO Annual Report as of the date of the firm’s first fiscal year end after October 1, 2012.…...

September 10, 2012 Ira Bodenstein, Trustee for PFG Best By Email Only – [email protected] Mr. Bodenstein: I write on behalf of the National Introducing Brokers Association (NIBA). Founded in 1991, the NIBA is a membership association of futures and options professionals registered primarily as Introducing Brokers (IBs). I write with regard to a specific distribution method your office proposed last week in the Peregrine Financial Group (PFG) bankruptcy, Docket Document #147: a proposal to make a bulk transfer of futures customers accounts with an interim distribution of funds, all to a qualified “acquiring FCM.” It seems to us that the…...

September 7, 2012 National Futures Association announces registration information webinar for swap FCMs, IBs, CPOs and CTAs The Commodity Futures Trading Commission (CFTC) recently published its final rule definitions for “swap,” “security-based swaps” and “security-based swap agreements.” As a result, firms that are not currently registered with the CFTC, but are acting as an FCM, IB or CTA with respect to swaps subject to the jurisdiction of the CFTC, will be required to register. Firms acting as CPOs also are required to register, unless the firm properly claims an exclusion or exemption from registration via NFA’s Electronic Exemption System. To…...

NFA submitted the following rule submission letters to the CFTC: Recordkeeping – Proposed Amendments to NFA Compliance Rule 2-10 » View Letter (PDF) Protection of Customer Funds – Proposed Amendments to NFA Financial Requirements Section 4 To Provide OnLine View-Only Access to FCM Customer Segregated/Secured Amount Bank Account Information » View Letter (PDF)   The Opinions expressed are the opinions of the author. The opinions, the trading styles, trading information and trading programs are not endorsed by the NIBA, but are the individual opinions, styles, information and programs of the author....

For CME Group, nothing is more important than the confidence customers have in our marketplace and the protection of our customers when using our markets. Earlier this year, CME Group launched the CME Group Family Farmer and Rancher Protection Fund, which is currently accepting applications from farmers, ranchers and cooperatives who traded in CME Group markets and suffered losses from the failure of PFG.  As an IB, you can help your clients sign up for the program and find additional information at www.cmegroup.com/clearing/family-farmer-fund.html Since the failure of MF Global and Peregrine Financial Group (PFG), CME Group, in conjunction with the NFA, CFTC and…...

At the Kansas City Conference we discussed CFTC Rule 1.71, which among other things, applies to conflicts of interests within a brokerage operation.  That is to say that the “research” department and the “trading” desks must independently coexist.  The genesis of the rule really comes from the securities industry where research departments tout trade recommendations to the brokers who in turn interact with their clients and often suggest the trade.   Admittedly, there is some overlap with the commodities world, but not as much as one may suppose leading to a conclusion that trying to replicate this concept in our industry…...

Over the past several months, NFA has worked with the industry to develop a number of rules to strengthen the protection of customer segregated funds. We will describe these rules in detail, including the adoption of NFA Financial Requirements Section 16, and steps we are proposing to obtain real-time information from FCMs’ depositories. Additionally, the CFTC imposed new requirements under Regulation 1.71, which calls for the development of procedures for all IBs and FCMs relating to research reports. We will discuss some of the common questions relating to this regulation and how firms can comply with the new requirements. Jennifer…...

Today’s FCMs face not just one risk, but many. Regulatory changes may dramatically alter the business model and viability of some. For other, managing risk associate with outsourcing key operations to 3rd party technology providers poses a challenge. And, of course, the financial risks some FCMs are taking in response to both internal and external pressures to perform are compounded by the current market environment. For over 20 years, Michael Coglianese CPA, P.C. has specialized in providing Introducing Brokers, CTAs and Funds with efficient and timely professional services, including audits, and compliance reviews. Tax preparation is tailored to each client’s…...

David Oppedahl is a business economist in the economic research department at the Federal Reserve Bank of Chicago, where he directs the Chicago Federal Reserve District’s survey of agricultural banks on agricultural land values and credit conditions. He regularly briefs the Chicago Federal Reserve on the state of our agricultural economy, including rural development, and other microeconomic research. The results of Mr. Oppedahl’s research are used to publish the Chicago Fed’s quarterly agricultural publication – AgLetter. David will present an economic outlook session at the NIBA September 12 program which incorporates current data with an explanation of the slow economic…...