CFTC Orders FCM to Pay $200,000 for Supervisory Violations (with Lofchie Comment)

The CFTC issued an Order filing and settling charges that a futures commission merchant (an "FCM") violated CFTC regulation 166.3 by failing to diligently supervise its employees' handling of customer accounts. In particular, the firm failed to stop one of its customers from acting as an FCM through its customer account for third parties.

Lofchie Comment: Pages 4-5 of the case provide a useful bibliography of "failure to supervise" actions brought under the CEA.

Cross-Reference(s): CFTC Rule 166.3 [Customer Protection Rules; Supervision].

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