NFA updates customer protection requirements
On Jan. 22 NFA updated its regulations regarding customer protection requirements for futures commission merchants, introducing brokers, commodity pool operators and commodity trading advisors.
The revisions include amendments to the financial requirements for FCMs as well as requirements regarding the management and handling of excess segregated customer funds in domestic futures accounts, foreign futures accounts and cleared swaps customer accounts.
The NFA's updated regulations spell out the obligations of an FCM's senior management when establishing the amount of residual interest to be maintained in customer accounts. The revisions also spell out permitted investments allowed with customer funds under the CFTC's regulation 1.25.
In addition, the revisions set out the requirement that FCMs prepare daily segregation calculations on the close of business on the prior day whenever a firm withdraws or transfers more than 25% of residual interest held in customer accounts.
