Co-authored by James M. Brady.
The National Futures Association (NFA) has amended the financial requirements applicable to member futures commission merchants (FCMs) acting as counterparties in foreign exchange (forex) transactions. Pursuant to NFA’s Financial Requirements Section 1(a), all member FCMs are required to maintain adjusted net capital equal to or in excess of certain amounts enumerated in Section 1(a). The amendment adds a provision to Section 1(a) to require an FCM acting as a counterparty in a forex transaction with an eligible contract participant to maintain adjusted net capital in excess of $20,000,000.
The amendment will be effective June 20, 2013.