Sound Off!

摘要

We have found some inaccuracies in your Futures magazine article, "The Forex Story: Only The Strong Survive" specifically in the section called "Who's Got $20 Mil?". The sentence that reads "The CFTC has always had the right to set a minimum 'Adjusted Net Capital' (ANC) for forex dealers who, unlike futures brokers, do hold customer funds and thus expose customers to their own financial risk" is misleading. The Commodity Futures Modernization Act of 2000 required any firm that acts as the counterparty to retail forex trades to be an "otherwise regulated entity", such as a bank, insurance company, broker-dealer or futures commission merchant (FCM). This resulted in a number of forex firms registering with the CFTC as FCMs even though they were not conducting exchange-traded futures business. However, because they were registered as FCMs, they were subject to an FCM's minimum net capital requirement of $250,000. The only way the CFTC could have raised the minimum net capital requirement for forex firms was to raise the requirement for all FCMs, which they chose not to do. It was NFA, subject to CFTC approval, that raised the minimum net capital requirements for Forex Dealer Members to $1 million and subsequently to $5 million.