FUTURES COMMISSION MERCHANTS In a July 7, 2014 Notice to Members, the National Futures Association (“NFA”) announced a reduction in the assessment fee paid by futures commission merchants (“FCMs”) Members. The NFA’s Board of Directors approved the reduced assessment fee on May 15, 2014. The reduction is a result of an amendment to NFA Bylaw 1301, which covers dues and assessments of NFA Members. Effective October 1, 2014, the amended paragraph (b) of Bylaw 1301will reduce the assessment fee by fifty percent (50%).  Each FCM member will pay, to the NFA, an assessment equal to $0.02 for each commodity futures....

By now, all FCMs are to have made public via their websites certain financial data per CFTC Rule 1.55. This information is important to Introducing Brokers as it makes available to your firm a way to better assess the credit profile of each FCM. Each FCM must have posted: Daily segregation statement for segregated, secured and cleared swap funds Summary capital computation for the most recent 12 months Most recent certified audit report Unaudited 1FR/Focus reports for the most recent 2 months Links to the FCM financial data on the NFA and CFTC website To further enable customers to make....

The growth and expansion of information technology and electronic communication have made it increasingly easy to collect, maintain, and transfer personal information about individuals.  Advancements in technology also have led to increasing threats to the integrity and privacy of personal information.  The Fair Credit Reporting Act of 1970 (‘‘FCRA’’), as amended in 2003, required several federal agencies to issue joint rules and guidelines regarding the detection, prevention, and mitigation of identity theft for entities that are subject to their respective enforcement authorities (also known as the “identity theft red flag rules”).  At the time the Agencies adopted their rules; the....

Although the majority of futures and forex transactions occur without issue, occasionally misunderstandings do happen. When either a broker or customer feels they have been wronged during the course of a transaction, NFA’s Arbitration department provides a forum for dispute resolution. NFA’s arbitration program is generally cheaper, faster and less formal than civil litigation or other dispute resolution forums. Claimants do not have to refer to statutes and regulations to prove their claims. However, they are responsible for proving that they have incurred a monetary loss and deserve compensation. Arbitration also has fewer procedural requirements than litigation, which is why....

As your industry advocate, the NIBA provides many services which help your business stay in compliance with NFA rules. “Ask the NFA,” is the way you can ask questions about those regulations and compliance requirements without having to call NFA directly. Just email us at [email protected] and we will get the answers for you. Please keep in mind the purpose of this contact is to keep the lines of communication between NFA and NIBA members open, not to fix any specific individual concerns.  This month’s questions were selected from those submitted by NIBA members over the last two months. The....

In this age of heightened regulatory scrutiny and the ever increasing risk of litigation from former employees and customers, coupled with the need to protect valuable trade secrets, it has become a best practice—if not a legal imperative—for IBs to require associated persons (APs) to enter into AP agreements.  AP agreements are designed to help reduce risks to IB employers and clarify expectations with APs.  Moreover, without such an agreement, a court may find that an IB has no trade secrets and no ownership of such important information as customer contact lists, marketing strategies or key documents.   AP agreements....