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RELEASE: pr5377-07

  • Release: 5377-07

    For Release: August 30, 2007

    CFTC’s Division of Clearing and Intermediary Oversight Issues Advisory on Forex Transactions

    Washington, DC – The Division of Clearing and Intermediary Oversight (DCIO) of the Commodity Futures Trading Commission (CFTC) has issued an Advisory concerning retail off-exchange foreign currency futures or option (forex) transactions.

    The DCIO Advisory addresses the following issues: (1) registration requirements for associated persons of firms registered as introducing brokers (IBs), commodity trading advisors, and commodity pool operators that are involved in forex transactions; (2) the permissibility of certain unregistered affiliates of a futures commission merchant (FCM) to act as proper counterparties in forex transactions; (3) claims that forex customer funds are segregated; (4) introducing entities acting as FCMs; (5) the applicability of the IB guarantee agreement to forex transactions and prohibiting guaranteed IBs from introducing forex transactions to an FCM that is not its guarantor FCM; (6) prohibiting forex account statements of an FCM’s unregistered affiliate from being included in the FCM’s account statements to its customers; and (7) prohibiting retail customers from acting as counterparties to each other in forex transactions.

    The Advisory may be accessed at the CFTC’s website at http://www.cftc.gov/ConsumerProtection/FraudAwarenessPrevention/ForeignCurrencyTrading/index.htm.

    Media Contacts
    Ianthe Zabel
    202-418-5080

    R. David Gary
    202-418-5085

    Last Updated: July 7, 2010

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