The NFA recently adopted an Interpretive Notice titled “Information Systems Security Programs” (Cybersecurity Interpretive Notice).  This new NFA policy, which goes into effect March 1, 2016, requires FCMs, IBs, CTAs, CPOs, RFEDs, SDs and MSPs to implement a cybersecurity program in order to meet existing obligations to diligently supervise trading activities. Every registrant will be … READ MORE

New Customer Protection Rules

In October 2013, the CFTC adopted a new set of rules designed to prevent the reoccurrence of another MF Global type disaster. My article on the New Customer Protection Rules has been published in the July/August issue of Futures Magazine. To read the article please click here

Cyber Security- FCMs, IBs, CTAs and CPOs

It seems that every day there is a report of a security breach at some company or another. Credit card numbers were stolen from Target and Neiman’s. Social security numbers and personal information were stolen from Advocate Health Care. And now there’s the discovery of the “Heartbleed” bug that may represent a serious vulnerability to … READ MORE

The Blame Game

MF Global was a Broker-Dealer/ FCM that speculated in highly leveraged sovereign debt with their proprietary funds. At some point they used their customer segregated accounts to support their proprietary positions. The result was a bankruptcy filing on Oct. 31 that has caused massive hardship to their customers and wreaked havoc on the futures industry. … READ MORE

MF Global “Disgraceful Disconnect”

An unintentional loss of connection to the CME Globex trading engine is called an “ungraceful disconnect.” Your working orders are canceled and your position essentially is frozen. What happened on Monday, Oct. 31, 2011 had a similar result, but the cause was a total disgrace — the MF Global bankruptcy filing a “disgraceful disconnect.” The … READ MORE

Old Rules – New Interpretations: Speculative Position Limits

Due to the rapid rise and rapid fall of the crude oil market in 2008, the CFTC has recently proposed a new rule on speculative position limits for the energy markets. Numerous comments have been sent to the Commission and the debate is ongoing over the economic, legal and philosophical merits of imposing position limits … READ MORE