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February 02, 2006
Annual Regulatory Reminder for Futures Commission Merchants
National Futures Association has always been committed to providing our Members with the resources they need to meet their regulatory obligations as efficiently as possible. During some of our recent audits, NFA Members have suggested that we provide them with an annual reminder regarding certain requirements that are not part of their day-to-day operations. Responding to this request, NFA is pleased to send you this email listing certain requirements you have for the upcoming year. This list does not capture all of your responsibilities, but it should help remind you of certain non-routine requirements.
Within the next 12 months you will be required to:
1. Complete the Annual Update/Questionnaire on NFA's website and pay your NFA dues on the anniversary date of your firm's registration. Failure to satisfy all the requirements in the annual update process within 30 days of your anniversary date will result in the withdrawal of your firm's NFA registration and/or Membership.
2. Complete NFA's Self-Examination Checklist located on NFA's Web site at http://www.nfa.futures.org/compliance/selfexam.asp.
4. Conduct Anti-Money Laundering ("AML") training for relevant employees and complete an audit of your AML procedures and training. For guidance in preparing your AML procedures, please consult NFA's Anti-Money Laundering questionnaire (Appendix A of the Self-Exam Checklist).
5. Review your Point of Contact information for USA PATRIOT Act 314(a) information requests and notify NFA of any changes.
6. Test your Disaster Recovery Plan and make any necessary adjustments. For guidance in preparing your plan, please consult NFA's Business Continuity and Disaster Recovery Plan questionnaire (Appendix B of the Self-Exam Checklist).
7. Provide Ethics Training as outlined in your firm's written Ethics Training Procedures. For guidance in developing your procedure, please consult NFA's Ethics Training Policy questionnaire (Appendix C of the Self-Exam Checklist).
8. Supervise the operations of any GIBs and/or Branch Offices, including conducting an annual onsite audit of every GIB and Branch Office.
9. If active in Security Future Products ("SFPs") or the retail off-exchange foreign currency market ("forex"), notify all SFP and forex customers of NFA's BASIC system.
10. Submit a certified annual report within 90 days after the firm's fiscal year end, or if your firm is also registered as a Broker/Dealer, within 60 days after the fiscal year end (in addition to submitting the firm's monthly Focus II/I-FR-FCM with NFA via WinJammer).
1. If active in SFPs, submit a log of any written customer complaints regarding SFPs to NFA within 15 days after the end of each quarter. You do not have to file the report if you do not receive any SFP complaints during the quarter.
2. For omnibus FCMs, submit the foreign futures and options report within 10 days after the end of each quarter.
On January 31, 2006 NFA conducted a one-hour Web seminar entitled, "Preparing for an NFA Audit." During the seminar NFA staff gave an overview of the audit process, shared some tips on how to prepare for an audit and discussed some of the most common deficiencies found by NFA auditors. You may access the seminar at http://www.nfa.futures.org/member/indexArchive.asp.