As part of its ongoing commitment to customer protection, National Futures Association (NFA) recently made changes to its display of futures commission merchant (FCM) financial information on its Background Affiliation Status Information Center (BASIC) online tool.
BASIC is a comprehensive database of registration, disciplinary and financial information about derivatives firms and salespeople. It contains the disciplinary history and other background information of more than 150,000 individuals and 10,000 firms that currently, or have been, involved in the derivatives industry.
Since 2012 when NFA enhanced the amount of information it provides to investors performing due diligence of firms, BASIC has displayed a variety of futures commission merchant (FCM) financial data. At this time, NFA made publicly available three reports on FCMs' percentage of customer segregated funds, secured amount funds and cleared swaps customer collateral held in cash, which are updated on a monthly or semi-monthly basis. However, in November 2013, the Commodity Futures Trading Commission amended a number of regulations to require FCMs to file further financial data.
As a result, beginning with the Nov. 17, 2014 Segregated Investments Detail Reports, NFA began including the amount of customer funds held at clearing organizations and brokers, the amount of customer-owned securities that are on deposit as margin collateral and information regarding repurchase transactions involving customer funds or securities as percentages on each applicable FCM financial data report. These results will appear in BASIC on Nov. 25, 2014.
To learn more about BASIC, or the public display of FCM financial information, visit NFA's website.
