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September 17, 2014
FCM Filing Requirements — Risk Exposure Reports and CCO Annual Report
CFTC regulations require FCMs to file with the Commission Risk Exposure Reports on a quarterly basis and a Chief Compliance Officer (CCO) report on an annual basis. As described more fully below, NFA is now requiring FCMs for which it is the DSRO to also file those reports with NFA.
Risk Exposure Reports
CFTC Regulation 1.11 requires each FCM to establish, maintain and enforce a system of risk management policies and procedures designed to monitor and manage the risks associated with the activities of the FCM (Risk Management Program). As part of the Risk Management Program, each FCM is required to provide to its senior management and its governing body quarterly Risk Exposure Reports, which set forth all applicable risks exposures of the FCM; any recommended or completed changes to the risk management program; the recommended time for implementing recommended changes; and the status of any incomplete implementation of previously recommended changes. Each FCM also is required to provide its senior management and its governing body with a Risk Exposure Report immediately upon detection of any material change in the FCM's risk exposure.
Each FCM is required to provide the CFTC with a copy of the quarterly and any interim Risk Exposure Reports within five business days of providing the report to its senior management. NFA is also requiring each FCM for which NFA is the DSRO to provide NFA with a copy of the Risk Exposure Report within the same five-day time frame. Beginning with quarterly risk reports as of September 30, 2014, FCMs will be required to submit the quarterly and any interim Risk Exposure Reports to the CFTC and NFA (where applicable) through the WinJammer™ system. In order to file a Risk Exposure Report through the WinJammer™ system, the FCM must create a "Regulation Notice" in the filing index section of WinJammer™ as of the ending date of the report, and then select the "Risk Exposure Report - Futures" filing type. After selecting the appropriate notice, the FCM must upload a PDF of the report.
CCO Annual Report
CFTC Regulation 3.3 requires each FCM to designate a CCO. Among other duties, the CCO is required to prepare a report that covers the FCM's most recently completed fiscal year containing the information outlined in CFTC Regulation 3.3 and provide the report to the FCM's Board of Directors or the FCM's senior officer. The CCO Annual Report must also be filed electronically with the Commission not more than 60 days after the end of the FCM's fiscal year. Pursuant to CFTC No-Action Letter 13-84 (December 30, 2013), FCMs have 90 days from the firm's fiscal year end to file CCO Annual Reports due in calendar year 2014. Beginning with each FCM's next CCO Annual Report, NFA also is requiring each FCM for which NFA is the DSRO to provide NFA with a copy of the CCO Annual Report within the same 60-day time frame (90 days for reports due in calendar year 2014). FCMs will continue to file their CCO Annual Report through the WinJammer™ system. As we notified Members in Notice I-13-07, in order to file the annual report through the WinJammer™ system, the FCM must create a "Regulation Notice" in the filing index section of WinJammer™ as of the date of the report and then select the "Chief Compliance Officer Report" filing type. After selecting the appropriate notice, the FCM must upload a PDF of the report.
If you have questions related to the submission of filings or WinJammer™, please contact Brian Rothfuss, Senior Manager, Compliance (email@example.com or 312-781-1439). Questions related to the Risk Exposure Reports or CCO Annual Reports should be directed to Dale Spoljaric, Managing Director, Compliance (firstname.lastname@example.org or 312-781-7415).