For Immediate Release
April 28, 2021
For more information contact:
Christie Hillsman, 312-781-1490, email@example.com
Karen Wuertz, 312-781-1335, firstname.lastname@example.org
NFA orders former associated person Jeremy Ruth never to reapply for NFA membership
April 28, Chicago—NFA has ordered Jeremy Ruth, a former associated person of Postrock Brokerage LLC (Postrock), never to reapply for NFA membership status in any capacity or act as a principal of an NFA Member. Postrock is a former NFA Member introducing broker located in Chicago, Illinois.
The Decision, issued by an NFA Hearing Panel, is based on a Complaint issued by NFA’s Business Conduct Committee and a settlement offer submitted by Ruth, in which he neither admitted nor denied the allegations. The Complaint alleges that he failed to disclose the impact of commissions on customers’ profit potential and placed trades for customers which offered no economic benefit to them and only generated additional commissions. The Complaint also alleges that Ruth made misleading statements to customers and failed to disclose that all of Ruth’s other customers had lost money. Finally, the Complaint alleges that Ruth made unauthorized trades for customers or exercised discretion over customer accounts without obtaining written authority.
For more information, read the Complaint and Decision.
Source: National Futures Association
Regulatory news. NFA has ordered OANDA Corporation (OANDA), an NFA Member retail foreign exchange dealer and futures commission merchant headquartered in Toronto, Canada, to pay a $200,000 fine. The Decision, issued by NFA’s Business Conduct Committee (BCC), is based on a Complaint issued by the BCC and a settlement offer submitted by OANDA. The BCC found that OANDA failed to submit accurate daily forex reports to NFA and failed to supervise. News & Notices | NFA (futures.org)
Strategic takeaway. The National Futures Association’s complaint illustrates the necessity of defining and maintaining your regulatory strategic position. Although the foreign exchange market is near unregulated in terms of price setting, market entry and maintenance of entry are regulated where the goal is a balancing act between ensuring that investors/traders are availed a high degree of market transparency regarding pricing, broker qualifications and integrity, and the integrity of a brokerage platform and the dealer’s need to seek out and maintain data on best currency prices, disseminating that information to investor/traders, while controlling costs and increasing profits.
A main component of maintaining a regulatory strategic position is consistency in not only implementing your own compliance program, but in auditing its performance. For example, failure to detect suspicious activity, respond in a consistent and timely manner to customer complaints, notice red flags from wire activity, adopt written protocols for protecting against technology threats, and file required reports to the U.S. Department of the Treasury or the Commodity Futures Trading Commission are indicative of consistent auditing within an organization.
OANDA’s problem started out with a customer complaint involving an unauthorized transfer of $5,000 out of a customer’s account. The resulting $200,000 fine may have been avoided.