Industry Issues and Improvements

 

1/22/15 High-Speed Trading Fills Void Left on Prop Desks That Trade FX

  • Banks are directly connecting to price feeds from Global Trading Systems LLC and Virtu Financial Inc. to help complete their clients’ currency orders, according to the chief executive officers of both computerized-trading companies. By working with the HFT firms, banks benefit from narrower gaps between buying and selling prices without having to reveal their trades in the wider market or pay fees to use external venues.”

 
1/22/15 Leverage Cripples a Currency Broker

  • The big move just arrived. On Jan. 15, the Swiss central bank abandoned its policy of limiting the value of the Swiss franc to €1.2 and let its national currency float freely. The decision shocked currency markets, sent the Swiss franc soaring, and blew a $225 million hole in FXCM as customer losses mounted. Shares of FXCM plunged as low as 98¢ on Jan. 16 before trading was halted and Niv grabbed a financial lifeline from Leucadia National, owner of the investment bank Jefferies Group. Leucadia will earn interest of as much as 17 percent on the $300 million loan and can force a sale of the brokerage, keeping at least half of the proceeds beyond the loan amount, FXCM said in a Jan. 19 statement.”

 
1/22/15 First Libor Individuals Fined by U.K. FCA in Martin Case 

  • Martin Brokers was fined 630,000 pounds by the FCA last year for rigging the London interbank offered rate. Brokers at RP Martin Holdings Ltd., part of Martin Brokers, colluded with a trader at UBS Group AG to manipulate Libor tied to the Japanese yen, the FCA said at the time.”

 
1/22/15 France, Austria Push to Break Deadlock on Transactions Tax

  •  France and Austria sought on Thursday to break deadlocked talks with nine other European countries over a financial transaction tax, by proposing that it be applied to a wide range of transactions but at low rates from next year.”

 

Regulator Newsmakers

 

1/22/15 CFTC Official Tied to Wall Street Profits From Merger Fight

  • J. Christopher Giancarlo joined the CFTC in June after working at a derivatives brokerage and serving as chairman of an industry lobbying group. Six weeks laterCME (CME:US) Group Inc., the world’s largest futures exchange, made an offer to buy Giancarlo’s former employer. In short order, his old firm’s stock price surged, adding an extra windfall to Giancarlo’s multimillion dollar severance as he divested his holdings.”

 
1/22/15 U.S. CFTC Grants SGX U.S. Futures Clients Direct Access

  • The futures and swaps regulator said that Singapore Exchange Derivatives Trading Limited (SGX-DT) had shown that the Monetary Authority of Singapore’s regulatory regime was comparable to that exercised by the CFTC.”

 
1/22/15 CFTC Nears New Rules to Curb Excessive Speculation

  • “The U.S. Commodity Futures Trading Commission is scheduled to complete on Thursday an important step toward an expected vote on rules the regulator says aim to curb excessive speculation on the prices of raw materials and agricultural products.”

 

CFTC Corner

 

1/16/15 PR7103-15 CFTC Orders Summit Energy Services. Inc. to Pay $140,00 Civil Monetary Penalty and Cease and Desist Unregistered Commodity Trading Advisor

  • The U.S. Commodity Futures Trading Commission (CFTC) today entered an Order requiring Summit Energy Services, Inc. (Summit Energy), a Delaware corporation with its principal place of business in Louisville, Kentucky, to pay a $140,000 civil monetary penalty for acting as an unregistered Commodity Trading Advisor (CTA).”

 
1/21/15 PR7105-15 CFTC Issues Order of Registration for the Tokyo Commodity Exchange, Inc. 

  • The U.S. Commodity Futures Trading Commission (Commission) announced today that it has issued an Order of Registration to the Tokyo Commodity Exchange, Inc. (TOCOM), a Foreign Board of Trade located in Tokyo, Japan. Under the Order, TOCOM is permitted to provide its identified members or other participants located in the U.S. with direct access to its electronic order entry and trade matching system to trade futures contracts on metals, fuels, rubber and agricultural commodities and futures and option contracts on gold.”

 

1/23/15 PR7110-15 Division of Swap Dealer and Intermediary Oversight Announces that Major Swap Participants May Furnish Chief Compliance Officer Annual Reports to the Commission Through WinJammer

  • The U.S. Commodity Futures Trading Commission’s (CFTC or Commission) Division of Swap Dealer and Intermediary Oversight (DSIO) today announced that Swap Dealers (SDs) and Major Swap Participants (MSPs) may furnish the annual reports of their Chief Compliance Officers (CCOs) to the Commission through WinJammerTM, and do not need to use the Commission’s Web portal.”

 
1/12/15 PR7101-15 CFTC’s Division of Market Oversight Issues Time-Limited Extension No-Action Relief Regarding Masking of Certain Identifying Information Required to be Reported

  • CFTC Letter 13-41, issued on June 28, 2013, permits part 45 and part 46 reporting counterparties to mask legal entity identifiers, other enumerated identifiers and other identifying terms, and permits Part 20 reporting entities to mask identifying information in certain enumerated jurisdictions. On June 27, 2014 the Division issued CFTC Letter 14-89, extending the relief provided in CFTC Letter 13-41 until no later than 12:01 a.m. (EST) on January 16, 2015.”

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