Amended AML Compliance Guidance for FCMs and IBs Now in Effect

NFA amended AML interpretive guidance for futures commission merchants ("FCMs") and introducing brokers ("IBs") to incorporate CFTC guidance on the regulatory obligations of "voice" brokers.

Voice brokers arrange derivatives transactions between dealers via telephone, instant message or similar means of communications, or enter orders directly on an exchange through electronic means. On July 22, 2019, the CFTC granted relief to voice broker IBs, clarifying that if an IB does not introduce an account to an FCM, then the IB has neither customers nor accounts, and neither the customer identification program ("CIP") nor the beneficial ownership ("BO") rules apply.

NFA Interpretive Notice 9045 on Compliance Rule 2-9 ("Supervision") requires FCMs and IBs to implement an AML program in compliance with the Bank Secrecy Act and regulations thereunder. The amendments to NFA's interpretive guidance - which went into effect on June 16, 2020 - clarify that, in accordance with the CFTC guidance, voice broker IBs are not required to establish and implement a CIP or apply BO requirements. Voice broker IBs must continue to meet other applicable NFA compliance obligations, including performing suspicious activity reviews, using available information.