National Futures Association Amends Financial Requirements for Forex Dealers

Posted on July 23, 2010 by Kevin M. Foley

Co-authored by Joshua Penner

The National Futures Association (NFA) has amended Sections 11(b) and (c) of the NFA Financial Requirements. These rules currently provide that a Forex Dealer Member (FDM) may include assets as current for purposes of determining adjusted net capital and as cover for currency positions, only if the assets are held at the following regulated entities not affiliated with the FDM: (1) a financial institution regulated by a U.S. banking regulator; (2) a broker-dealer registered with the Securities and Exchange Commission; (3) a futures commission merchant or a retail forex dealer registered with the Commodity Futures Trading Commission; (4) a state-regulated insurance company; or (5) a regulated foreign equivalent of such entities.

The amended rules remove regulated foreign entities from the list of regulated entities. However, the NFA will continue to have authority to approve the use of certain regulated foreign equivalents that are appropriately regulated and capitalized.

The amendments will become effective October 1.

The NFA notice concerning the amendments can be found here.

Tags:
Trackbacks (0) Links to blogs that reference this article Trackback URL
http://www.corporatefinancialweeklydigest.com/admin/trackback/213204
Comments (0) Read through and enter the discussion with the form at the end
Post A Comment / Question Use this form to add a comment to this entry.







Remember personal info?
Send To A Friend Use this form to send this entry to a friend via email.