The US National Futures Association (NFA) has issued a
$300,000 fine against Connecticut-based Interactive Brokers
for infringing NFA rules.
The Decision, issued by NFA’s Business Conduct Committee, is
based on Complaints filed on February 18, 2012 and July 5, 2013
and a settlement offer submitted by Interactive.
The 2012 Complaint alleged that Interactive violated NFA Bylaw
1101 by conducting futures business with non-NFA Members and
violated NFA Compliance Rule 2-4 by allowing an introducing
broker to act as a de facto FCM. In addition, the 2012 Complaint
alleged that Interactive violated NFA Compliance Rule 2-9(a) by
failing to diligently supervise its operations.
The 2013 Complaint alleged that Interactive violated NFA
Financial Requirements Section 4 by failing to ensure balances held
in a customer secured amount account – identified under
Commodity Futures Trading Commission Regulation 30.7 – were
reported in the form and manner prescribed by NFA.
In addition to agreeing to pay a fine of $300,000, Interactive
agreed to adopt and implement enhanced written procedures to
ensure compliance with NFA Bylaw 1101. Also, the firm agreed to
undertake a review of its open futures and retail FX accounts to
determine whether Interactive is in full compliance with NFA
Bylaw 1101 with respect to the account holders of all accounts
opened prior to the date of Interactive’s settlement offer. It also
agreed to take prompt and appropriate action in those instances
where the firm finds that it did not fully comply with the
requirement of NFA Bylaw 1101.
Interactive neither admitted nor denied the allegations.