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January 14, 2010
Annual Regulatory Reminder for Commodity Trading Advisors
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. Therefore, we are providing you with an annual reminder regarding certain requirements that are not part of your day-to-day operations. This list does not capture all of your responsibilities for the upcoming year, 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 process on the anniversary date of your firm's registration. This process includes (1) completing the electronic Annual Registration Update; (2) electronically submitting the firm's Annual Questionnaire on NFA's website and (3) paying your annual registration fees and NFA dues.
Failure to satisfy all of 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. Carefully check your registration record including address, contact information, and listed principals. For a detailed explanation of who needs to listed as a principal, who needs to be registered as an Associated Person, and when it's appropriate to list a branch office and a branch office manager access NFA's Registration Issues Podcast.
2. Complete NFA's Self-Examination Checklist located on NFA's website at http://www.nfa.futures.org/NFA-compliance/publication-library/self-exam-checklist.HTML.
4. 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).
5. 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).
6. File any new exemption notices electronically through NFA's Exemption System.
7. If soliciting new clients, distribute a Disclosure Document that is no more than 9 months old and that has been reviewed by NFA. Disclosure Documents should be filed electronically through NFA's Disclosure Document System.
8. If placing bunched orders, analyze each trading program at least quarterly to ensure that the order allocation method has been fair and equitable and document this analysis.
We also want to remind you again to complete the new questions in the Annual Questionnaire assessing Member's futures-related and off-exchange forex business. On November 30, 2009, NFA issued Notice to Members I-09-21 requesting all Members to complete a series of new questions located in the Annual Questionnaire assessing their futures-related business. Although some NFA Members have complied with this request, many have not. It is critical that Members access and complete questions in the Firm and DR Information section of the Annual Questionnaire as soon as possible. This applies not only to Members trading on-exchange futures products but also Members trading in the off-exchange foreign currency (forex) market.
As always, if you need assistance with these or any other NFA requirements, please contact NFA's Information Center at (800) 621-3570.