NIBA - Celebrating 35 Years

NIBA Journal

Insights, analysis, and updates from the National Introducing Brokers Association

Member Announcements
2 min read

Annual Member Meeting- September 24, 2015

Annual Membership Meeting - September 24 - Chicago The NIBA Annual Membership Meeting is scheduled for September 24 at the CME Group Building in Chicago. This is a full-day event and includes a box lunch, cocktail reception and demonstration hall. In 2014, over 250 IBs, CTAs, FCMs and other industry professionals attended. This year’s event includes five business sessions: “The El Nino Effect” - how El Nino will affect the livestock, grain and financial markets “What I Really Want to Know” - the six compliance questions most often asked by IBs/CTAs to their compliance firms and accountants “NFA Representatives Update” - IB/CTA representatives answer to you “Cybersecurity - Before & After the Breach” - a general session on the year’s most talked about regulatory issue “Cybersecurity - What IBs and CTAs need to Know” - an industry specific session which includes the NFA This year’s luncheon speaker is Blu Putnam,...

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Member Announcements
2 min read

Chairman's Letter

Dear Members - I recently completed a survey of registered Introducing Brokers for the guide I am writing for the industry. I have been writing The Complete IB Handbook, now in its 5th edition, since 1999, and I learn a great number of things about our community each time your survey responses are returned. Of the IBs who responded, about 60% were Guaranteed IBs. Most of those indicated that the capital requirements and the current regulatory environment were the reasons they chose to be registered as GIBs. Over 25% of the respondent firms had been registered for 25 years or more; nearly 50% of those reported they had customer accounts open for seven years or more. About 20% of the IBs held registrations or professional licenses in addition to the IB status. The majority of other registrations named were overwhelmingly Commodity Trading Advisor (CTA) with a FINRA or some type...

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Member Announcements
1 min read

Thank you DePaul University!

Thank you to DePaul University and to the speakers at last week's NIBA/DePaul co-sponsored event in Chicago. Thank you especially to Dr. Carl Luft, Alex Perry, Mark Shore and Dr. Jacob Furst, all of DePaul, who along with Jerry Nolan, Steve Petillo, John Nelson and Holli Kranz of the NIBA, planned and presented the program. Nearly one hundred NIBA members heard sessions on meeting the challenges of marketing managed futures and updates on cybersecurity compliance before joining colleagues at a cocktail reception on the University Terrace. NIBA is in the second year of our academic partnership with DePaul University. A video of last week's business sessions will be posted on our website within a few days. Melinda Schramm, Chairman, celebrates the Blackhawks win during the NIBA/DePaul Chicago Event

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Member Announcements
2 min read

NFA Reminder to Update ORS

Regulatory reminder: Accurate and current business contact information and email address When a firm first applies for registration, the applicant must provide the address of its main office location, its telephone number, and may provide a general email address. The applicant must also list the names, addresses and telephone numbers of the individuals whom the applicant designates as the firm's contacts for a variety of functions such as compliance, membership and enforcement. Email addresses are required for enforcement contacts and may be added for other contacts as well. On an annual basis, all registered firms must review the information in their registration records contained in NFA's Online Registration System (ORS), update any outdated or incorrect information and certify that all of the information is complete and accurate. Beyond the formal annual registration review process, registered firms have an obligation to continually update the information in their registration records to keep...

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8 min read

Housekeeping, Reminders & Updates

Securities and Exchange Commission SEC Proposed Modernizing and Enhancing Information Disclosed and Reported by RICs and RIAs The Commissioners of the Securities and Exchange Commission (“SEC”) unanimously approved two (2) rules which would require enhanced disclosures and increased reporting by registered investment companies (“RICs”) and registered investment advisers (“RIAs”), as well as RIAs’ maintenance of additional performance-related records. RIAs are now required to report: Aggregate information related to the types of assets held in separately managed accounts (“SMAs”) and the SMAs’ use of borrowing and derivatives; and Additional information about an adviser’s advisory business, branch office operations and the use of social media. RIAs are now required to maintain: Back-up records of the calculations of performance information that is distributed to any person (current rules have this requirement with regard to information distributed to ten (10) or more persons); and Communications related to performance or rate of return of account...

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5 min read

Get to Know the Regulator: CFTC Division of Swap Dealer and Intermediary Oversight

Who is in charge of the Division of Swap Dealer and Intermediary Oversight: DSIO is run by a Director, who is assisted by the DSIO Deputy Directors and Chief Counsel. Tom Smith is the Acting Director, and the Deputies and their respective branches are as follows: Mr. Smith, who also serves as Deputy Director of Capital, Margin and Segregation; Erik Remmler, Deputy Director of Registration and Compliance; and Kevin Piccoli, Deputy Director of Examinations. Frank Fisanich is the DSIO Chief Counsel. How many employees are a part of DSIO: DSIO has 89 employees, who are located in the CFTC’s Washington, D.C. Headquarters and in the regional offices in Chicago, Kansas City and New York. What is the general function of DSIO: DSIO oversees compliance with the Commission’s registration and follow-on regulations applicable to intermediaries. For example, DSIO assesses and monitors intermediaries’ compliance with requirements for: capital, margin, and customer asset...

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8 min read

Secrets from Inside the NFA

Until recently I was working as a field auditor with the National Futures Association (“NFA”). During my time at NFA, the self-regulator was enduring a great deal of criticism. After the failures of MF Global and PFG calls for the heads of NFA’s leadership were coming in at a frenetic pace. While this period was no doubt painful for NFA to endure, the long hard look in the mirror they had to take as an organization became transformative. Today NFA is implementing some of the most sweeping changes to its audit approach since becoming the industry’s lead watch dog. After joining Turnkey Trading Partners (“Turnkey”, a leading compliance service provider) I have frequently been asked by clients what internal changes NFA has made since the collapse of the aforementioned FCMs and final implementation of the Wall Street Reform Act (“Dodd Frank”) regulations. In this article I will provide some of...

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Member Announcements
1 min read

FIA Webinar: Cybersecurity Threats: Preparation & Response

Cybersecurity has been the subject of sessions at both the NIBA New York City event, April 1 and last week's joint program with DePaul University in Chicago. We will present another full session at our Annual Membership Meeting, September 24 in Chicago, directed at practices to protect your customers' data, including compliance developments and guidance. Next Monday, June 29, 2:30pm EDT, the Futures Industry Association (FIA) will host a webinar entitled "Cybersecurity Threats: Preparation & Response." We encourage you to learn more about the Financial Services Information Sharing and Analysis Center and the FIA.  Register here.

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1 min read

Trading at Settlement (TAS) for Agricultural Futures

First Trade Date Monday, June 8, 2015 Trading at Settlement (TAS) is an order type that allows a market participant to buy or sell futures contracts during the trading day equal to the yet-to-be determined settlement price, or at a price up to four ticks above or below that price. Why TAS Reduce uncertainty related to pricing around settlement Grain elevators and processors may use TAS orders to price forward contracts at or near the settlement value TAS orders offer a transparent alternative to floor based MOC orders, which will no longer be available after July 2 Key Features Available on CME Globex for Grain, Oilseed and Livestock futures Available for outrights and spreads Quotes will be published in real time on the screen throughout the trading day TAS order entry is not allowed prior to the beginning of each group's pre-open state Learn About TAS View SER View TAS...

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Member Announcements
2 min read

Calling All IBs!

I have been writing The Complete IB Handbook since 1998 - this year marks the 6th edition. The Handbook is a look at the state of Introducing Broker business today and a how-to guide for starting an IB. CME Group sponsors The Complete IB Handbook and makes it available on its website. In order to update the contents for each year's edition, CME Group and I created a survey containing questions on subject areas from monthly expenses of running the company to markets most heavily traded by customers of an IB. I compile that data and write eight chapters of information which reflect how an IB business is handled. Surveys were emailed by the CME Group about mid-May. Here is the link to the survey in case you did not receive yours -- CME Group Survey You can help me write this guide by making sure it accurately reflects what...

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