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2006 | 2005 | 2004 | 2003
June 16, 2006
Increases in Minimum Net Capital Requirements
NFA is sending this Advisory to remind FCMs, including Forex Dealer Members, and independent IBs of the changes to the minimum
net capital requirements that will become effective on July 31, 2006. Specifically, the minimum capital requirements will increase
as follows:
- For FCMs, from $250,000 to $500,000;
- For independent IBs, from $30,000 to $45,000; and
- For Forex Dealer Members, from $250,000 to $1,000,000.
The changes will also impose the following new requirements:
- A $7,500,000 minimum capital requirement for FCMs with affiliates, if those affiliates are authorized to act as counterparties solely
by virtue of their affiliation with a registered FCM; and
- A $5,000,000 minimum capital requirement for all FCMs that are counterparties to off-exchange forex options transactions with retail customers.
In addition, by June 28, 2006, each FCM must notify NFA, in writing, if it:
- Offers leveraged off-exchange forex contracts to retail customers;
- Offers off-exchange forex options to retail customers; and
- Has an affiliate that offers leveraged off-exchange forex contracts, including options, to retail customers.
FCMs should forward their responses to NFA Compliance Manager Lisa Marlow by email at lmarlow@nfa.futures.org. You may also direct any questions to
Ms. Marlow at 312-658-6525 or to NFA Compliance Director Sharon Pendleton at spendleton@nfa.futures.org or 312-658-6540.
Finally, we are currently revising the appropriate reporting forms used by FCMs and IBs to address the changes. We will provide you with further information when the changes are completed.
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