Release: #5062-05
For Release: March 29, 2005

CFTC Staff Permits FCMs and IBs to Rely Upon Certain CTAs to Perform Elements of their Customer Identification Programs

Washington, D.C. -- The U.S. Commodity Futures Trading Commission's (CFTC's) Division of Clearing and Intermediary Oversight issued a no-action letter on March 14, 2005, that permits futures commission merchants (FCMs) and introducing brokers (IBs) to rely upon certain commodity trading advisors (CTAs) to perform procedures of the FCM’s or IB’s customer identification program (CIP). The relief is available where a CTA is registered with the CFTC or is exempt from registration and is registered with the Securities and Exchange Commission as an investment adviser.

Under the CIP rules, FCMs and IBs are permitted to rely only upon those financial institutions that are subject to final anti-money laundering program (AMLP) rules to conduct elements of their CIPs. CTAs are not subject to AMLP rules. The no-action relief allows FCMs and IBs to rely upon such CTAs prior to the time the CTAs become subject to final AMLP rules.

The letter is available at the Commission’s website: http://www.cftc.gov/files/tm/letters/05letters/tm05-05.pdf. Copies of the no-action letter also may be obtained by contacting the Commission’s Office of the Secretariat, Three Lafayette Centre, 1155 21st Street, N.W., Washington, D.C. 20581, (202) 418-5100.

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CFTC Media Contacts
Alan Sobba
(202) 418-5080
R. David Gary
(202) 418-5085
Office of External Affairs

Related Document
CFTC Letter No. 05-05