CFTC Staff Letters Archive

CFTC Staff Letters Archive provides Letters from 2007 and earlier. For Letters published 2008 or later visit the All Letters page.

There are no Advisory Letters or Other Written Communications for 2007 or earlier.

Date	PDF and Description
08/26/1999	99-36 ; Rule 4.7 (a);; No-Action The Division of Trading and Markets provided exemptive relief under Rule 4.7(a) to a registered CPO, notwithstanding the presence of a non-QEP in its fund, where the non-QEP is an officer and principal of the CPO, has over 20 years experience in the financial services industry, and is responsible for the general investment operations of the fund.
08/20/1999	99-32 ; Section 5a(a)(9) of the Commodity Exchange Act, Commission Regulation 1.52, and Division of Trading and Markets' Financial and Segregation Interpretation No. 4-1;; No-Action The Division of Trading and Markets is issuing an interim Financial and Segregation Interpretation No.4-2 -- Risk-Based Auditing. The interpretation permits self-regulatory organizations to adopt a system of risk-based auditing for their member-Futures Commission Merchants.
08/16/1999	99-35 ; Rules 4.23 and 4.33;; No-Action The Division of Trading and Markets exempted a CPO and CTA firm from the requirements of Rules 4.23 and 4.33 that the firm must maintain certain books and records in accordance with Rule 1.31 at its main business office. The exemption is subject to the conditions that: (1) the firm will notify the Division if the location of any original books and records changes; (2) the firm remains responsible for ensuring that all books and records required by Rules 4.23 and 4.33 are maintained in accordance with Rule 1.31 and for assuring their availability to the Commission, the NFA, or any other agency authorized to review such books and records in accordance with Commission regulations; (3) within 48 hours after a request by a representative of the foregoing, the firm will obtain the original books and records and provide them for inspection at its main business office; (4) the firm must disclose in its CPO and CTA Disclosure Documents where all Commission required books and records are kept; and (5) the firm remains responsible for compliance with Rules 4.23 and 4.33.
08/16/1999	99-34 ; Rule 4.7(a);; No-Action The Division of Trading and Markets granted a CPO an exemption such that it may treat a non-QEP, high-level employee, as a QEP. The Division took this position because, among other things: (1) the employee directed the department of the CPO responsible for reviewing, analyzing, and calculating risk estimates for, all pools operated by the CPO; (2) the employee has worked for the CPO for eight years; (3) the CPO obtained the employee's written consent to be treated as a QEP, and (4) the CPO represented that the employee is fully familiar with the risks associated with the pool in which the employee will invest, and the employee has access to all information relevant to investing in that pool.
08/11/1999	99-59 ; Rule 4.7(b);; No-Action The Division of Trading and Markets granted a CTA an exemption such that it may treat as a QEC an LLC with less than $5 million assets ("Non-QEC"). The Division took this position because, among other things: (1) the member of the LLC who is responsible for all of the LLC's investment decisions and who will have access to all information pertinent to the LLC's trading account in a QEC ("QEC Member"); (2) the QEC Member is a Commission registrant with extensive experience managing commodity interest trading accounts; (3) the QEC Member is the only person who contributed capital to the LLC; (4) the only other member of the LLC is a trust established by the QEC Member; (5) the QEC Member agreed that the LLC may be treated as a QEC; and (6) the QEC Member established both the LLC and the trust for estate planning purposes.
08/11/1999	99-42 ; Rule 4.7;; No-Action The Division of Trading and Markets denied a request to treat a person who was not a qualified eligible participant as a qualified eligible participant because he did not meet the portfolio requirement of Rule 4.7(a), he was not an officer or principal of the CPO of the exempt pool, and he was not otherwise employed by the CPO.
08/11/1999	00-31 ; Rules 4.21, 4.22, and 4.23(a)(10) and (a)(11);; No-Action The Division of Trading and Markets permitted a registered CPO to continue to claim relief from Rules 4.21, 4.22, and 4.23(a)(10) and (a)(11) in connection with the CPO's operation of a fund, notwithstanding the investment in the fund of a non-QEP principal of the CPO and two non-QEP charitable trust established by two other principals of the CPO. The non-QEP investors were, or were created and managed by, principals of the CPO who had been employed by the CPO for at least the past four years and who should have access to the information otherwise required by Rules 4.21, 4.22, and 4.23(a)(10) and (a)(11).
08/05/1999	99-40 ; Rule 4.23;; No-Action CPO permitted to keep its books and records at other than its main business office - i.e., at the main business office of the person who provided administrative services to the CPO.
07/16/1999	99-29 ; Rule 4.7(a);; No-Action The Division of Trading and Markets granted an exemption to a CPO which allowed the CPO to treat as QEPs four non-QEP employees of the CTA that advised commodity pools operated by the CPO. The employees were all either executive officers of the CTA or otherwise sophisticated investors.
07/14/1999	99-30 ; Section 4m(1);; No-Action The Division of Trading and Markets issued a no-action position to a co-general partner of a commodity pool, relieving the co-general partner from the duty to register as a CPO. The Division took this position because, among other things: (1) the other general partner was already registered as a CPO; (2) the other general partner represented that it would undertake all CPO responsibilities, and the co-general partner's activities would be limited to providing advice on investments not subject to regulation by the Commission; (3) the other general partner was the sole shareholder, president, and employee of the co-general partner; and (4) the other general partner would be jointly and severally liable with the co-general partner.