Responding to a request from the Chairwoman and Raking Member of the Senate Committee on Agriculture, Nutrition and Forestry, the CCC released its recommendations for the re-authorization of the Commodity Exchange Act. The CCC recommendations include the following:
- Codify a first priority right for customers over all assets of an insolvent FCM's estate;
- Require that FCM residual financial interest in the customer segregated account be held in a separate but related account;
- Establish a specific criminal penalty for segregation violations;
- Increase the severity of civil monetary penalties for segregation violations;
- Provide for a Customer's Committee to represent the interests of customers in bankruptcy proceedings;
- Establish a separate account class for retail forex customers;
- Establish a separate account class for alternative segregation arrangements;
- Give the CFTC the authority to determine the appropriate liquidation proceeding for an insolvent FCM;
- Examine whether or not the CEA excludes the National Futures Association ("NFA") from using a portion of its member assessments for a customer protection fund; and
- Give the CFTC authority to bring criminal prosecutions.
Download the complete document below.