CFTC Allows FCMs And IBs To Consolidate Risk Disclosure Documents

The CFTC Division of Swap Dealer and Intermediary Oversight granted no-action relief to futures commission merchants ("FCMs") and introducing brokers ("IBs") by allowing them to provide non-institutional customers with a single-risk disclosure document that consolidates the separate risk disclosure statements required by CFTC Rules 1.55, 30.6, 33.7 and/or 190.10. In its request for no-action relief, the Futures Industry Association explained that providing two separate risk disclosure statements to non-institutional customers that contain substantially similar risk disclosure information is unnecessary and potentially confusing to customers.

Commentary

With this bit of good housekeeping ‎out of the way (though codifying the relief directly in the CFTC rules would have been better), perhaps the CFTC now can turn its attention to rationalizing the three different definitions of "U.S. person" in Rules 3.10(c)(3)(i) and 4.7, and in the Cross-Border swap