Chairman's Message | August 2011

Dear NIBA Member:

On August 8, 2011, the Association filed a comment letter relating to the Proposed Amendment to CFTC Regulation 1.35(a). This proposed amendment goes beyond the NFA Rule which requires firms with a certain number of disciplined APs to record conversations with clients. The CFTC proposal would require every IB to record all oral and written communications with a client or potential client which lead to a transaction.

After receiving member comments, the NIBA Board of Directors filed our Association comment letter vigorously opposing the proposed amendment. You can view the comment at http://comments.cftc.gov. Look for the comments due 8/08/2011.

In January 2011, the Association also filed a comment letter opposing Proposed CFTC Regulation 1.71: FCM-IB Conflicts of Interest which would require IBs to separate people researching or analyzing price or markets from anyone involved in the firm’s trading or clearing functions who might prejudice or bias the researcher. We opposed that proposed amendment, and the comments can also be viewed on the CFTC website.

Both of the proposals remain pending, among several others, ad may still be approved and enacted by the CFTC. If passed, these amendments will likely change the way many IBs do business by causing them to erect barriers separating the functions inside their firms or hire additional personnel. They will also likely significantly increase the cost of technology and recordkeeping.

During the 1:00 pm session at the September 12, 2011 NIBA meeting we will discuss these CFTC proposals among several others. We will also talk about what the Association is doing and what you can do to make sure the CFTC knows where you stand.

Of course, as always, the September 12 meeting at the UBS Center in Chicago includes many interesting and valuable sessions:

• Learn where to look and what to look for when hiring at your IB or CTA
• Get a marketing makeover * Hear Darin Newsom’s opinion on whether commodities are in a “bubble”
• Launch an online lead generation campaign
• Network with colleagues at the NIBA/CTA Expo joint cocktail reception