NIBA - Celebrating 35 Years

NIBA Journal

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

Member Announcements
5 min read

Guidance to NFA Member CPOs and CTAs that Operate or Advise Pools Pursuant to an Exemption under CFTC Regulation 4.13(a)(4)

Notice to Members I-12-09 June 22, 2012 Guidance to NFA Member CPOs and CTAs that Operate or Advise Pools Pursuant to an Exemption under CFTC Regulation 4.13(a)(4) On February 24, 2012, the CFTC issued final rules amending CFTC Part 4 Regulations to rescind the exemption from registration available to CPOs offering certain qualifying pools under CFTC Regulation 4.13(a)(4). Although Member CPOs that currently operate a pool(s) pursuant to a 4.13(a)(4) exemption may continue to operate the pool pursuant to that exemption until December 31, 2012, those CPOs must determine whether the 4.13(a)(4) exempt pool qualifies for an exemption from registration under CFTC Regulation 4.13(a)(3) or whether the CPO will become subject to CFTC Part 4 reporting and disclosure requirements for that pool subsequent to December 31, 2012. Similarly, any CTA that advises a 4.13(a)(4) exempt pool pursuant to an exemption under CFTC Regulation 4.14(a)(8)(D) may only continue to advise that...

By NIBARead article
MF Global Updates
3 min read

Trustee Report Apparently Indicates Trustee Close to Recovering Sufficient Assets to Make Non-Insider Customers Whole if CFTC Rules Upheld

On June 4, 2012, the MF Global Inc. ("MFGI") trustee released his first six month report on the SIPA liquidation of MFGI. In the report, the trustee detailed recoveries the trustee has already achieved and also prospective recoveries on behalf of both MFGI's proprietary accounts and the segregated asset pools for MFGI's former customers. A CFTC rule provides that in the event of shortfall an FCM's firm assets go to make up the shortfall, this would mean that MFGI's proprietary assets would be allocated to make up any extant shortfalls in the segregated asset pools of MFGI's former customers. Creditors will argue that this rule is invalid and a court decision will be necessary to determine if it is upheld. An analysis of the trustee's report seems to indicate that he is close to recovering sufficient assets to make up the current shortfall and thus make all public customers whole...

By NIBARead article
Member Announcements
3 min read

Chairman's Message | June 2012

Dear Members- The Answer: Communication, Communication, Communication. The Question: What’s the most important benefit of your NIBA Membership? The NIBA’s mission is to keep communication channels open between members, and between members and other industry participants, including regulators. The dialogue helps keep you informed and assures that your opinions are heard. This what the Association is doing this month: May 30 - NIBA filed a request for an extension of time to the CFTC for implementation and enforcement of Rule 1.71 - Conflict of Interest June 1 - CFTC granted NIBA’s request and extended enforcement for all IBs and FCMs for 60 days. (Request and CFTC letter found in this month's Newsletter.) June 2 - General Creditor Claims filing deadline in the MF Global Bankruptcy. June 5 - NIBA/CME Joint Webinar with Bryan Durkin, CEO of the CME Group as Guest Speaker and Mike Burke, Secretary of the NIBA as...

By NIBARead article
Marketing
2 min read

An Economic Overview & Outlook: Kansas City and the Nation | Summer Conference Presentation Summary

Kelly Edmiston will present “Economic Conditions in the U.S. and Kansas City Region.” The presentation will begin with a discussion of recent output in the U.S. economy and provide a near-term outlook based on publicly available Federal Reserve projections and a consensus of leading forecasters across the country. The discussion will then turn to a detailed discussion of labor market trends and outlook in both the U.S. as a whole and in the Kansas City area specifically. A number of interesting trends are shaping the labor market outlook, and several of these are rather unique to the recent recession, aptly termed the “Great Recession” by many, and its anemic recovery. The unemployment rate will be discussed, but also the inability of the headline unemployment rate to fully capture the state of the labor market. Alternative indicators will then be presented that Edmiston argues provide a more complete labor market picture....

By NIBARead article
Marketing
2 min read

New SAR Filing Requirements

The Financial Crimes Enforcement Network (FinCEN) recently made some changes to its Suspicious Activity Report (SAR) filing requirements that will likely impact an IB’s AML program. Specifically, beginning July 1, 2012, any financial institution, including an IB, filing a SAR must do so electronically through FinCEN’s BSA E-Filing System. According to FinCEN, E-Filing will enhance the quality of FinCEN’s electronic data, improve its capabilities in supporting law enforcement and increase cost efficiencies. There is no charge for using the BSA E-Filing System. FinCEN has indicated, however, that firms that file a SAR in paper form after the July 1 deadline may be subject to a civil monetary penalty of up to $500 for each improperly filed form. In order to file a SAR through FinCEN’s BSA E-Filing System, an IB must be enrolled as a BSA E-filer. Information on how to enroll, including an E-Filing webinar, is available at http://www.fincen.gov/forms/e-filing/index.html....

By NIBARead article
Marketing
1 min read

Register for Kansas City Marketing & Sales Event Now!

The Summer NIBA Meeting, co-sponsored by the Kansas City Board of Trade is scheduled for Thursday, June 21 at the KCBT. Coffee and registration begins at 1:15pm. Business sessions begin at 2pm. A networking/cocktail reception will follow immediately. Program details are found here, and include 3 great presentations by 4 great speakers - Bryce Anderson | Meteorist for Telvent DTN, Kelly Edmiston | Sr. Economist for the Federal Reserve Board, KC, Jennifer Sunu | Director, Audits & Investigations, NFA and Neal Stevens | Attorney, Schuyler, Roche & Crisham Early registration for NIBA and KCBT Board Members is complimentary. After Monday, June 18 there is a $25.00 late charge fee for everyone including walk-ins. For more information, contact Melinda Schramm, melinda@futuresrep.com. » REGISTER NOW

By NIBARead article
Member Announcements
1 min read

Webinar at the CME | Darin Newsom, Telvent DTN Senior Analyst

Date: Tuesday, 26 June 2012 Time: 2:00pm CT Location: Attend Online or In person at CME Group Visitor's Center Theatre, 141 W. Jackson Blvd., 5th Floor, Chicago Telvent DTN Senior Analyst Darin Newsom will take a look at the Prospective Plantings report along with Quarterly Grain Stocks numbers, evaluating what the figures might mean for the markets going forward. Darin can provide analytical insight and commentary on all commodity markets, as well as the international and national events that move them. His commentary has been featured on CNBC's Morning Call and The Wall Street Journal Online MarketBeat. » REGISTER NOW

By NIBARead article
Focus on the Membership
5 min read

Heritage West Financial | June 2012 Focus on the Membership

How did you get started? How did the firm get started? I started by trading my own account at the San Diego branch of Conti-Commodity in 1979 when I was 20 years old. Those were wild and woolly days! About 20 traders came in to the office on a daily basis to hang out and watch the big quote board on the front wall in the office. With the noise from the mechanical numbers revolving with each price change and the board lighting up either green or red for new highs and lows along with the squawk boxes blaring and brokers furiously calling in orders (no computers back then) it was quite an electric atmosphere. I traded my own account for years and in 1990 became a broker at a former Heinold office that was owned and operated by its former branch manager. Just a month later the owner announced...

By NIBARead article
Marketing
2 min read

NIBA Summer Marketing & Sales Event Hosted at the Kansas City Board of Trade

On June 21, 2012, the Kansas City Board of Trade will host the NIBA Summer Marketing and Sales Event. Registration and coffee open at 1:15pm and the business sessions begin at 2:00pm. A cocktail reception will follow immediately. The Kansas City Board of Trade, established near one of the world's most fertile growing regions, is the largest free market for hard red winter wheat. Prices negotiated at the KCBT are the benchmark for wheat prices around the world. The KCBT was founded in 1856 and 20 years later a "grain call," similar to wheat futures trading as it is known today, was established. The exchange has become an international market force, influencing wheat prices in Australia and Argentina as well as Kansas and Oklahoma. The exchange set new annual volume records in 2011 for Hard Red Winter wheat futures and for the exchange as a whole. A total of 6,582,673...

By NIBARead article
Marketing
2 min read

The Vanishing FCM…

Opinion piece by Richard Strait | Strait, LLC Over the past 7-10 years the FCM community has contracted exponentially to just a handful of providers. While many reasons for this can be cited, those that stand out are the increased costs of the regulatory compliance and increased capital requirements, coupled with skyrocketing regulatory haircuts levied on that capital and lower revenues. While the electronic market place has increased the cost efficiency of the Exchanges and their member firms, Capital “haircuts” on customer segregated funds alone may reach 10% in the near future while only five years ago they were as low as 4%. Many FCMs, particularly those who are subsidiary companies of larger firms and banks, must now go back to the parent for additional capital. Although the cost of money to the banking community is at record lows, parent firms may require 5% or more for the regulatory capital...

By NIBARead article
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