NFA Announces Additional Reporting Requirements for Forex Dealer Members (NFA Notice I-14-07)

The National Futures Association ("NFA") issued a notice stating that it is implementing new reporting requirements effective February 28, 2014. Under the new requirements, Forex Dealer Members ("FDMs") must report certain specified information to the NFA on a monthly or quarterly basis through FOREX reports, which should be submitted through EasyFile.The NFA stated that the first monthly report is due on March 25, 2014, and will require the following information for the month of February or as of February 28, 2014:

• entities where house commodity trading accounts were held and the number of accounts held at each entity (at any time during the prior month);
• all counterparties utilized by the firm to any repurchase or reverse repurchase agreements (at any time during the prior month);
• any non-trade based fees the firm charged to customers (at any time during the prior month);
• all forms of funding accepted by the firm for customer trading accounts (at any time during the prior month);
• all formal lines of credit held by the firm during the prior month and the amount of credit available from that line (also report the total amount drawn from each line during the month regardless of whether the amount has been repaid);
• number of customer accounts whose trading volume represents 10% or more of the firm's overall trading volume (as of the month-end reporting date);
• number of proprietary and non-customer accounts the trading volume of which represents 10% or more of the firm's overall trading volume (as of the month-end reporting date);
• if the firm allows employees to engage in outside business activities; and
• if the FDM offered any new products or services that the firm did not offer in a previous monthly reporting period.

The first quarterly FOREX report should be dated March 31, 2014, and is due on April 24, 2014. The report will require the following information:

• any material administrative, civil, enforcement, or criminal complaints or actions filed against the firm in which such complaints or actions have not concluded, or any enforcement complaints or actions filed against the firm during the last three months;
• the five Associated Persons who generated the greatest revenue during the last 3 months; and
• the frequency with which the firm performs scenario analyses to assess its financial condition and continued compliance with capital and other regulatory requirements (i.e., stress testing).

See: NFA Notice I-14-07.