CFTC/NFA forum

On July 23, 2008, NFA released a statement to their
Forex Dealer Members (”FDMs”) advising that pursuant to CFTC
Reauthorization 2008, the adjusted net capital will be increased to $20
million. The current adjusted net capital requirement for FDMs is $5
million. The increase will be phased in through $5 million increments.
The first increase will take place October 31, 2008, which is an
extension of the original CFTC deadline of September 19, 2008. After
the first phase-in period, FDMs will be required to maintain at least
$10 million in adjusted net capital. The second increase will take
place on January 17, 2009, which will bring the requirement to $15
million. The last and final capital phase-in will be on May 16, 2009
setting forth a new requirement of $20 million

The notice also provides that NFA plans to modify the current
provisions of Section 12b. Currently, Section 12b states that FDMs who
offer greater than 100:1 leverage are required to maintain double the
current adjusted net capital. Instead, NFA has proposed to modify this
section to require these firms to maintain an additional $10 million or
150% of the adjusted net capital bringing the total capital to $30
million.

http://www.nfa.futures.org/news/newsNotice.asp?ArticleID=2165

About The Author

Felix Shipkevich

Felix Shipkevich is a Manhattan-based attorney and general counsel for Shipkevich Law Firm. He has extensive experience working with the CFTC and NFA on registration, compliance, and enforcement issues for CPOs, CTAs, FCMs, IBs, and RFEDs. Felix also practices intellectual property and corporate governance law.