The Financial Crimes Enforcement Network issued a final rule, to clarify and strengthen customer due diligence requirements, which became effective on July 11, 2016 for which covered financial institutions must comply with by May 11, 2018. Covered financial institutions include banks, brokers or dealers in securities, mutual funds, and futures commission merchants and introducing brokers in commodities. The rules contain explicit customer due diligence requirements and include a new requirement to identify and verify the identity of beneficial owners of legal entity customers, subject to certain exclusions. Covered financial institutions are not presently required to know the identity of the…...
Housekeeping, Reminders, and Updates
COMMODITY FUTURES TRADING COMMISSION Guidance on Clearinghouse Recovery and Wind-Down Plans On July 21, 2016, the CFTC announced the publication of guidance to clearinghouses on recovery plans and wind-down plans, CFTC Letter No. 16-61 (“Letter 16-61”). The subject of Letter 16-61 is recovery plans and wind-down plans maintained by derivatives clearing organizations (“DCOs”) and tools for the recovery and orderly wind-down of DCOs. Pursuant to CFTC Regulation 39.39(b), DCOs are required to adopt and maintain recovery and wind-down plans. The purpose of the plans are to detail how the DCO intends to maintain a viable plan for: the recovery…...
Life of a Brokerage Firm – Part 1
Life of a Brokerage Firm <Part One> Ron Grossman and Ryan Griffeth conducted as series of interviews discussing the various stages of a brokerage firm. Interviews are presented here in Q&A form. There are a number of participants in this article series from brokerage firms, new individual brokers and industry professionals contributing their unique opinion and expertise. <Industry Professional> James Bibbings, Turnkey Trading Partners What is the background of new IBs or brokers entering the business today? I began my career in this industry when I moved to Chicago to work for NFA in 2005. At that time the CME…...
DePaul University Derivatives Briefing Summary, NFA Cybersecurity Requirements
On July 14, 2016, NIBA hosted a cybersecurity panel focused on the new NFA requirements that became effective on March 1, 2016. Dale Spoljaric of NFA, Gil Vega of CME and Matt Kluchenek of Baker McKenzie addressed various issues and practical considerations associated with the new requirements. The panel was moderated by Jeff Henderson of Greenberg Traurig. Dale Spoljaric focused on the new requirements and the approach that NFA is taking in connection with its audit of member firms’ policies and procedures. Mr. Spoljaric emphasized that NFA plans to provide education to its members as the new requirements are phased…...
The Complete IB Handbook
The Complete IB Handbook has recently been updated WWW.cmegroup.com/ibhandbook Written by Melinda Schramm, Founder of the NIBA and President of MHS Capital Resource, Inc. and sponsored by the CME Group, this guide contains eight chapters of information for the Introducing Broker on everything from how to register and what to expect at your first audit to a practical business plan and considerations for registering as a CTA. The online Handbook, now in its 6th Edition, also has a look at the current state of business of IBs in 2016 — how we continue to recover from the failures of MF…...
Seasonality of WTI Crude Oil Futures
Summary WTI Crude Oil futures is currently priced around the 30-year average. This makes the market on par with the longer-term average of the front-month futures contract. The 30-, 15- and five-year seasonality averages of WTI Crude Oil front-month futures show declines in the second half of the year. The seasonality data offers evidence for crude oil to form a long-term bottom. Earlier this year, crude oil bounced off its multi-year low, and many market participants are now READ MORE _____________________________________ Mark Shore Shore Capital Research LLC Alternative Investment Research & Consulting http://www.shorecapmgmt.com https://twitter.com/shorecap http://www.linkedin.com/in/shorem Decoding the Myths…...
July’s Chairman Letter
Ally: To join with another person or group to get or give support – Merriam-Webster Dictionary, 2016 NIBA is fortunate to have several incredible allies. DePaul University, our academic partner in Chicago, co-sponsored our summer briefing July 14. Over 130 NIBA members and supporters registered for afternoon business sessions which included a look at the managed futures world from a compliance and regulation point of view, and an overview of cybersecurity readiness. Articles following up on the discussions sparked by the DePaul sessions appear in this newsletter, and we’ll post the program video as soon as it is available.…...
Summary of the Managed Futures Panel 3rd Annual NIBA/ DePaul University Derivatives Briefing on July 14, 2016
A few months ago Tom Sandy (Rice Dairy), Jerry Nolan (County Cork) and I discussed some ideas for the topic of this panel. Tom is involved in operations, Jerry in marketing and I’m involved in research. The one overlapping component for all of us is compliance and operations. The topic of the panel discussed marketing managed futures from a compliance and operations perspective. This topic is probably a different perspective from marketing managed futures as you may frequently hear at events. A CTA may be successful at raising assets. However, if it wasn’t done properly, you may get a call…...
Save-the-Date: September 14, NIBA Membership Meeting – CME Group Bldg. Chicago
Registration is open now for the Annual NIBA Membership Meeting. CME Group will host the Association at 20 So. Wacker, Chicago. This meeting is a full-day event of six business session which include, among others: – Sessions specifically for CTAs – Compliance updates on hot topic Regulation – NFA IB & CTA Representatives Report to the NIBA Our day includes a Continental Breakfast, Lunch, all breaks and a networking reception. NIBA members attend FREE. Ryan Griffeth, Postrock Brokerage & Steve Petillo, NIBA co-chair this event along with Brian Gaffud, Rosenthal Collins Group. We are still forming the full…...
Thank you DePaul University & Exchange Analytics
Thank you DePaul University & Exchange Analytics Over 130 industry professionals and supporters were registered for the NIBA Joint Briefing at the Chicago downtown campus of DePaul University, July 14. Thank you to co-sponsors DePaul University — especially Dr. Carl Luft, Alex Perry and Kelly Bakas of DePaul’s Arditti Center, and Exchange Analytics. Both business sessions were videotaped by DePaul personnel and will be available to members on the NIBA website. Coupons provided by Exchange Analytics can be redeemed for FREE AML & Cybersecurity Training within 30 days of the meeting. Questions regarding the training or the coupons…...