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9005 - NFA COMPLIANCE RULE 2-4: GUIDELINES FOR THE DISCLOSURE BY FCMS AND IBS OF COSTS ASSOCIATED WITH FUTURES AND CLEARED SWAP TRANSACTIONS
(Board of Directors, effective June 1, 1986; revised July 24, 2000 and July 1, 2019)
National Futures Association ("NFA") Compliance Rule 2-4 provides that "Members and Associates shall observe high standards of commercial honor and just and equitable principles of trade in the conduct of their commodity futures business and swaps business." NFA Compliance Rule 2-4 requires that each FCM Member, or in the case of introduced accounts, the Member introducing the account make available to its customers, prior to the commencement of trading, information concerning the costs associated with futures1 and cleared swap transactions.
If fees and charges associated with futures and cleared swap transactions are not determined on a per trade or round-turn trade basis, the FCM or IB Member must provide the customer with a complete written explanation of such fees and charges.
NFA recognizes that FCM and IB Members may employ various arrangements in assessing customers fees and charges associated with futures or cleared swap transactions. Any such arrangement which is intended to or is likely to deceive customers is a violation of NFA Requirements and will subject the Member to disciplinary action.
1 NFA Bylaws and Rules define "futures" to include exchange-traded options. See NFA Bylaw 1507 and NFA Compliance Rule 1-1(q).