The Commodity Futures Trading Commission Divisions of Market Oversight (DMO), Swap Dealer and Intermediary Oversight (DSIO), and Clearing and Risk (DCR) (together, the Divisions) issued CFTC Letter 20-17 to remind Designated Contract Markets (DCMs), Futures Commission Merchants (FCMs) and Derivatives Clearing Organizations (DCOs) of their obligations to prepare for extreme market volatility, low liquidity and possibly negative pricing for certain contracts. The Divisions issued the advisory in light of unusually high volatility and negative pricing experienced in the May 2020 West Texas Intermediate (WTI), Light Sweet Crude Oil Futures contract on April 20 (the penultimate day of trading and expiration of the contract), although the guidance also applies to trading in other commodities.
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CFTC Grants Relief to Address Net Capital Treatment of PPP Monies and FINRA Annual Assessments
Posted in CFTC
On April 22, the Commodity Futures Trading Commission (CFTC) published a no-action letter providing guidance for futures commission merchants (FCMs) and introducing brokers (IBs) in connection with calculating the FCM’s or IB’s net capital under CFTC Regulation 1.17. Pursuant to the no-action letter, the CFTC will not bring an enforcement action against an FCM or…
CFTC Approves Proposed Amendments to Its Bankruptcy Rules
By Kevin M. Foley & Jack A. West on
Posted in CFTC, Derivatives
At the Commodity Futures Trading Commission (CFTC) open meeting on April 14, the CFTC unanimously approved proposed amendments to Part 190 of its rules governing bankruptcy proceedings of commodity brokers, including futures commission merchants (FCMs) and derivatives clearing organizations (DCOs). The proposed amendments are intended to comprehensively update Part 190 to reflect current market practices. Among other revisions, the proposed amendments to Part 190 would:
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NFA Issues Notice Regarding FinCEN COVID-19 and AML/CFT Guidance
By Kevin M. Foley & Elizabeth Organ on
Posted in CFTC
On April 8, the National Futures Association (NFA) published Notice I-20-17, notifying Member futures commission merchants (FCMs) and introducing brokers (IBs) of two recent issuances from the Financial Crimes Enforcement Network (FinCEN).
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CFTC Provides Relief to Certain Foreign Affiliates of FCMs in Response to COVID-19
By Kevin M. Foley & Stanley V. Polit on
Posted in CFTC
On March 31, the Division of Swap Dealer and Intermediary Oversight (DSIO) of the Commodity Futures Trading Commission (CFTC) issued Staff Letter No. 20-12 (Letter), announcing temporary no-action relief (Relief) that allows certain non-US entities, that are exempt from registration with the CFTC as introducing brokers pursuant to CFTC Regulation 30.5 (Foreign Brokers), and which are affiliates of futures commission merchants (FCMs) registered with the CFTC, to handle US order flow under certain conditions.
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CFTC Issues Temporary Relief from Certain Regulatory Requirements
By Kevin M. Foley & Elizabeth Organ on
Posted in CFTC, Derivatives
On March 17, the staff of the Commodity Futures Trading Commission (CFTC) issued a series of no-action letters to provide certain CFTC-regulated entities and registrants with temporary regulatory relief from a targeted set of regulatory requirements.
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NFA’s Swaps Proficiency Requirements Effective and Available Online
By Kevin M. Foley & Timothy D. Kertland on
Posted in CFTC, Derivatives
On January 27, the National Futures Association (NFA) issued a notice to members as a reminder that the effective date for NFA’s Swaps Proficiency Requirements (Requirements) is January 31, and that the Requirements must be completed by applicable individuals by the January 31, 2021 compliance date. The Requirements are now available online here.
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NFA’s Swaps Proficiency Requirements Become Effective on January 31
Posted in CFTC, Dodd-Frank Developments
On January 7, the National Futures Association (NFA) issued Notice to Members 1-20-01, announcing that a webpage devoted to Swaps Proficiency Requirements will become accessible on January 31, 2020.
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CFTC Issues Guidance on Chief Compliance Officer Annual Report Preparation
By Kevin M. Foley & Jack A. West on
Posted in CFTC, Derivatives
On December 4, the Division of Swap Dealer and Intermediary Oversight (DSIO) of the Commodity Futures Trading Commission (CFTC) issued an advisory addressing the preparation of the Chief Compliance Officer (CCO) Annual Report for futures commission merchants, swap dealers and major swap participants. The CFTC advisory discusses a number of common deficiencies that the staff has identified in its review of the 2019 CCO Annual Reports and provides additional guidance to Registrants regarding the requirements of the CCO Annual Report in light of the deficiencies found.
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CFTC, FinCEN, and SEC Issue Joint Statement on Activities Involving Digital Assets
On October 11, the leaders of the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN), and the Securities and Exchange Commission (collectively, the Agencies) issued a joint statement reminding persons engaged in activities involving digital assets of their anti-money laundering (AML) and countering the financing of terrorism (CFT) obligations under the Bank Secrecy Act of 1970 (BSA).
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