- If any of the disciplinary information questions on Forms 7-R or 8-R are answered "yes" what is the likelihood that the registration will be approved?
- What does adjudication mean?
- What is a criminal charge?
- Should an arrest that did not result in criminal charges be disclosed?
- If a criminal case is filed in a state or country that does not classify offenses as a felonies or misdemeanors, is disclosure still required?
- Do felony charges have to be disclosed?
- If I was charged with a felony but I was not convicted or the charge was reduced to a misdemeanor, do I need to answer "yes" to any questions?
- Which misdemeanor offenses are required to be disclosed?
- Should criminal offenses involving the failure to file income tax returns or charges filed in a military court be disclosed?
- Do gambling offenses have to be reported?
- My lawyer told me that I don't have to disclose my criminal offenses because the Court expunged them from the record. Is that correct?
- If I pleaded guilty to a felony or one of the specified misdemeanors and the Court later vacated my guilty plea, do I still have to disclose that?
- If a criminal conviction is pardoned, is disclosure still required?
- If a criminal matter is disclosed, what documents must be submitted?
- Where can copies of criminal documents be obtained?
- What happens if a criminal matter is not disclosed?
- Do I need to disclose any matter that isn't related to the futures industry?
- Does an arbitration case or claim filed against me with the National Association of Securities Dealers, Inc. require disclosure?
- Does a reparations case filed against me with the Commodity Futures Trading Commission require disclosure?
- What documentation is required if a Chapter 7 or Chapter 11 petition for bankruptcy was filed within the past 10 years?
- Does a sole proprietor have to disclose personal disciplinary actions on both the Form 7-R and Form 8-R?
If any of the disciplinary information questions on Forms 7-R or 8-R are answered "yes" what is the likelihood that the registration will be approved?
If the matter disclosed is a disqualification from registration under either Section 8a(2) or 8a(3) of the Commodity Exchange Act, the application will probably be reviewed by a special NFA committee. The committee will review the circumstances of each disqualification independently and decide whether to approve the registration.
What does adjudication mean?
In a criminal case, adjudication is the determination by the court that the defendant is guilty or not guilty.
What is a criminal charge?
A criminal charge is a complaint, information, indictment or equivalent instrument that contains an accusation of a crime.
Should an arrest that did not result in criminal charges be disclosed?
No; however you may be required to provide documentation indicating that no criminal charges were filed. If so, a letter from the applicable district attorney, arresting agency, or a court search is sufficient.
If a criminal case is filed in a state or country that does not classify offenses as a felonies or misdemeanors, is disclosure still required?
Disclosure is required because the offense could be deemed a felony or misdemeanor based upon the potential sentence. Therefore, if the matter were punishable by a sentence of at least a one-year imprisonment or a fine of at least $1,000, it would be considered equivalent to a felony and should be disclosed under Form 7-R or Form 8-R, Disciplinary Information-Criminal Disclosures. This would also apply to a general court martial.
If the matter were punishable by a sentence of less than one-year imprisonment or a fine of less than $1,000, it would be considered equivalent to a misdemeanor. Specified misdemeanor charges to which you pleaded guilty or of which you were found guilty or convicted, should be disclosed under Form 7-R or Form 8-R, Disciplinary Information-Criminal Disclosures. This would also apply to a special court martial.
Do felony charges have to be disclosed?
If felony charges are pending against you, you must answer "yes" to Question C, Disciplinary Information-Criminal Disclosures. If you pled guilty, nolo contendere ("no contest") to or been convicted or found guilty of any felony offense, you must answer "yes" to Question A, Disciplinary Information-Criminal Disclosures. If you were subject to felony charges that were dismissed or nolle prossed and you did not pled guilty, nolo contendere ("no contest") to nor were you convicted or found guilty of the felony charges, then disclosure is not required however you may be required to provide documentation confirming the final disposition of the felony charges.
If I was charged with a felony but I was not convicted or the charge was reduced to a misdemeanor, do I need to answer "yes" to any questions?
If you pleaded not guilty and were found not guilty, you do not need to answer "yes" to any question. However, if you pleaded guilty or no contest to, or were found guilty of a felony, you must answer "yes" to Question A, Disciplinary Information-Criminal Disclosures, even if it did not result in a conviction. If the felony charge was reduced to a specified misdemeanor to which you pleaded guilty or of which you were found guilty or convicted, you are required to answer "yes" to Question B, Disciplinary Information-Criminal Disclosures.
Which misdemeanor offenses are required to be disclosed?
Form 7-R and Form 8-R, Disciplinary Information-Criminal Disclosures, Question B describe which misdemeanor plea or conviction requires disclosure. NFA's Registration Investigations staff is available at (312) 781-1410 or (800) 621-3570 if you've read the forms and are still not sure.
Should criminal offenses involving the failure to file income tax returns or charges filed in a military court be disclosed?
Income tax offenses are treated like all other criminal matters. If you pleaded guilty or no contest to, were found guilty of or were convicted of a felony income tax offense, you must answer "yes" to Question A, Disciplinary Information-Criminal Disclosures. If you pleaded guilty to, were found guilty or convicted of a specified misdemeanor income tax offense, you are required to answer "yes" to Question B, Disciplinary Information-Criminal Disclosures. If felony or misdemeanor income tax charges are pending against you, you must answer "yes" to Question C, Disciplinary Information-Criminal Disclosures. These same rules apply to matters that are the subject of a military court proceeding. Matters that are the subject of a general court martial are considered felonies and matters that are the subject of a special court martial are considered misdemeanors. NFA's Registration Investigations staff is available at (312) 781-1410 or (800) 621-3570 if you've read the Disciplinary Information-Criminal Disclosure questions and are still not sure.
Do gambling offenses have to be reported?
Gambling offenses are treated like all other criminal matters. If you pleaded guilty or no contest to, were found guilty of or were convicted of a felony gambling offense, you must answer "yes" to Question A, Disciplinary Information-Criminal Disclosures. If you pleaded guilty to, were found guilty or convicted of a misdemeanor gambling offense, you are required to answer "yes" to Question B, Disciplinary Information-Criminal Disclosures. If felony or misdemeanor gambling charges are pending against you, you must answer "yes" to Question C, Disciplinary Information-Criminal Disclosures. NFA's Registration Investigations staff is available at (312) 781-1410 or (800) 621-3570 if you've read the Disciplinary Information-Criminal Disclosure questions and are still not sure.
My lawyer told me that I don't have to disclose my criminal offenses because the Court expunged them from the record. Is that correct?
No. The Commodity Futures Trading Commission requires that all criminal matters involving felonies and specified misdemeanors to which you have pleaded guilty, must be disclosed, regardless of whether they have been expunged; set aside or sealed; there was a conditional discharge or post-conviction dismissal; a state certificate of relief from disabilities was issued; or a pardon was granted.
If I pleaded guilty to a felony or one of the specified misdemeanors and the Court later vacated my guilty plea, do I still have to disclose that?
Yes, unless you then pleaded not guilty and were found not guilty after a trial.
If a criminal conviction is pardoned, is disclosure still required?
Yes.
If a criminal matter is disclosed, what documents must be submitted?
It is best to request the entire file from the court and submit all the documents to NFA. NFA will probably request additional documents from you if your documents do not reflect all of the following information:
- The complaint
- Your entry of a plea or plea agreement, or conviction
- The sentence
- Proof that you completely satisfied your sentence
- The final outcome of the court's action (i.e., dismissal)
You should always submit a notarized statement to NFA that describes in your words, the circumstances surrounding the arrest.
Where can copies of criminal documents be obtained?
The court where the case was handled can provide copies of the court documents or conduct a court search.
What happens if a criminal matter is not disclosed?
NFA will most likely find out about the matter while conducting the background check with the FBI. Failure to disclose matters could be deemed an additional disqualification from registration. It is in your best interest to disclose all applicable matters.
Do I need to disclose any matter that isn't related to the futures industry?
Yes. Only Question J, Disciplinary Information-Financial Disclosures on the Form 8-R is limited to activity in the futures industry.
Does an arbitration case or claim filed against me with the National Association of Securities Dealers, Inc. require disclosure?
Only unpaid commodity arbitration awards require disclosure under Form 8-R, Disciplinary Information- Financial Disclosures, Question J. Otherwise, pending, adjudicated, settled or dismissed arbitration matters do not need to be disclosed.
Does a reparations case filed against me with the Commodity Futures Trading Commission require disclosure?
Unpaid reparations awards require disclosure under Form 8-R, Disciplinary Information-Financial Disclosures, Questions J. Otherwise, pending, adjudicated, settled or dismissed reparations matters do not need to be disclosed.
What documentation is required if a Chapter 7 or Chapter 11 petition for bankruptcy was filed within the past 10 years?
Disclosure of a bankruptcy matter is required only if the bankruptcy trustee filed an adversary action against you. For those cases, you should provide NFA with a copy of the initial complaint and the final disposition of each matter.
Does a sole proprietor have to disclose personal disciplinary actions on both the Form 7-R and Form 8-R?
Yes, the same information must appear on both the Form 7-R and Form 8-R.
If you have any other questions, contact NFA's Information Center at (800) 621-3570 or (312) 781-1410 or e-mail NFA.
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