Search NFA Rulebook
Search This Rule
Amendments to Compliance Rule 2-46. CPO and CTA Reporting Requirements
June 30, 2017— Amendments to Compliance Rule 2-46. and new NFA Interpretive Notice NFA Compliance Rule 2-46: Reporting Financial Information on NFA Forms PQR and PR. An explanation of the amendments and Interpretive Notice can be found in the September 6, 2016 rule submission letter.
Part 500. Proceedings to Deny, Condition, Suspend and Revoke Registration
RULE 509. SETTLEMENTS.
[Adopted effective December 10, 1993. Effective dates of amendments: August 1, 1994; July 1, 2001; May 31, 2002 and April 2, 2004.]
(a) When Offers May be Made. Parties may propose offers of settlement at any time during the course of the proceeding. All offers of settlement shall be in writing.
(b) Content of Offer. Each offer of settlement made by a respondent shall:
(1) acknowledge service of the Notice of Intent;
(2) admit the jurisdiction of NFA with respect to the matters set forth in the Notice of Intent;
(3) include a waiver of:
(A) a hearing;
(B) all post-hearing procedures;
(C) Commission and judicial review;
(D) any objection to NFA staff's participation in the consideration of the offer by the Membership Committee or a designated Subcommittee;
(4) stipulate the basis in the record on which a Final Order may be entered, which basis may consist solely of the Notice of Intent and any findings contained in the order of settlement;
(5) in a case where a respondent is offering to be registered subject to conditions, contain representations by the firm or the individual, if the individual is sponsoring a FB or FT applicant or registrant, that will be sponsoring the respondent that the sponsor will abide by any conditions imposed on the applicant's or registrant's registration and that the sponsor is eligible to sponsor a registrant whose registration is subject to conditions. A firm or individual is eligible to sponsor a registrant whose registration is subject to conditions if the sponsor is not:
(A) subject to a pending adjudicatory proceeding brought by or before the Commission pursuant to the provisions of Sections 6(b), 6(c), 6c, 6d, 8a or 9 of the Act; or
(B) subject to a pending adjudicatory proceeding brought by or before NFA alleging fraud or failure to supervise; or
(C) subject to any special supervisory obligations imposed by the Commission or NFA or agreed to by such sponsor or guarantor; or
(D) subject to the reporting requirements of NFA Financial Requirements Section 6 or CFTC Regulation 31.7(b); or
(E) subject to a finding within the last five years, in an action by the Commission or NFA, that the firm or any of its current principals have engaged in fraud or have failed to supervise its APs;
(F) subject to a pending adjudicatory proceeding brought by or before NFA, against any of the firm's current principals, alleging fraud or failure to supervise; and
(6) consent to the entry of a Final Order reflecting the terms of settlement agreed upon, including where appropriate:
(A) findings that the respondent is disqualified from registration under Section 8a(2), 8a(3) or 8a(4) of the Act; and
(B) the revocation, suspension, denial or granting of full registration or imposition of conditioned registration.
(c) Submission of Offer. Offers of settlement made by a respondent shall be submitted in writing to NFA staff, which shall present them to the Membership Committee or a designated Subcommittee with staff's recommendation. NFA staff shall inform the respondent if the recommendation will be unfavorable, in which case the offer will not be presented to the Membership Committee or a designated Subcommittee unless the respondent so requests. Any offer of settlement not presented to the Membership Committee or a designated Subcommittee shall be null and void with respect to any acknowledgment, admission, waiver, stipulation or consent contained therein and shall not be used in any manner in the proceeding by any party thereto.
(d) Acceptance of Offer. The offer of settlement will only be deemed accepted upon issuance by the Membership Committee or a designated Subcommittee of a Final Order based on the offer. Upon issuance of the Final Order, the proceeding shall be terminated as to the respondent involved.
(e) Rejection of Offer. When an offer of settlement is rejected by the Membership Committee or a designated Subcommittee, the party making the offer shall be notified by NFA staff and the offer of settlement shall be deemed withdrawn. A rejected offer of settlement and any documents relating thereto shall not constitute a part of the record in the proceeding. The offer will be null and void with respect to any acknowledgment, admission, waiver, stipulation or consent contained therein and shall not be used in any manner in the proceeding by any party thereto.