CFTC Issues No-Action Relief Regarding Introducing Brokers' Compliance with Certain Financial Reporting and Capital Computation Requirements (CFTC Letter 13-82)
The CFTC Division of Swap Dealer and Intermediary Oversight ("DSIO") issued a no-action letter that provides relief for certain Introducing Brokers ("IBs") from certain financial reporting and capital computation requirements under CFTC Rule 1.10 ("Financial Reports of Futures Commission Merchants and Introducing Brokers") and Rule 1.17 (" Minimum Financial Requirements for Futures Commission Merchants and Introducing Brokers").The relief provided in the letter states that DSIO will not recommend an enforcement action concerning three separate areas:
- treatment of liabilities to employees contingent upon the receipt of certain commission receivables when calculating the minimum net capital requirement;
- the use of International Financial Reporting Standards, as opposed to the required U.S. Generally Accepted Accounting Standards, for certified and unaudited financial statements by certain qualified Foreign IBs; and
- the permitted delayed filing of certified financial statements for IBs whose registration was approved by the National Futures Association during the period of October 1, 2013, through December 31, 2013.
See: No-Action Letter 13-82; Press Release.