FCM Sanctioned for Failure of the Segregation of Customer Accounts

The CFTC obtained a federal court order requiring a registered FCM to pay a civil monetary penalty for violating the Commodity Exchange Act and CFTC regulations concerning the segregation of customer funds, and for supervision failures. The complaint charged that, in violation of CFTC regulations, the account in which customer assets were maintained was not subject to a legal obligation to make customer funds available for redemption by the next business day following a request, and was not properly titled as a "customer segregated funds" account. The complaint also charged that the FCM failed to obtain from the financial institution a letter acknowledging that the funds in the account were customer funds to be kept segregated from the FCM's proprietary funds, and that the FCM similarly failed to obtain and/or keep written acknowledgments for at least six additional accounts that held customer funds. The complaint also charged the FCM with supervision failures, including that the firm did not have written policies or procedures governing the opening and maintenance of customer segregated accounts.

View Complaint in full here (links externally to CFTC website).
See also: Press Release.