CFTC Staff Letter 05-05: No-Action for FCMs and IBs Relying on CTAs for CIP Procedures

U.S. COMMODITY FUTURES TRADING COMMISSION
Three Lafayette Centre
1155 21st Street, NW, Washington, DC 20581
Telephone: (202) 418-5438
Facsimile: (202) 418-5547 jcarley@cftc.gov
Division of Clearing and
Intermediary Oversight
James L. Carley
Director
CFTC letter No. 05-05
March 14, 2005
No-Action
Division of Clearing and Intermediary Oversight Barbara B. Wierzynski, Esq.
Executive Vice President & General Counsel
Futures Industry Association
2001 Pennsylvania Avenue, N.W., Suite 600
Washington, DC 20006-1573
Re: 31 CFR 103.123 and 17 CFR 42.2 – Request to Treat Certain CTAs as Subject to Anti-Money Laundering Program Rule for Purposes of Complying with Reliance Provision in Customer Identification Program Rule for FCMs and IBs Dear Ms. Wierzynski:
This is in response to your letter dated May 5, 2004 to the Office of General Counsel (“OGC”) of the Commodity Futures Trading Commission (“Commission”). By your correspondence, you request relief on behalf of futures commission merchants (“FCMs”) and introducing brokers (“IBs”) that will allow them to treat commodity trading advisors (“CTAs”) that are registered with the Commission or are exempt from registration but are registered with the Securities and Exchange Commission (“SEC”) as investment advisers (“IAs”)1 as if they are subject to an anti-money laundering program (“AMLP”) rule (“AMLP Rule”) under the Bank Secrecy Act (“BSA”).2 Specifically, you request confirmation that OGC will not recommend that the Commission commence any enforcement action against FCMs or IBs if they rely upon such CTAs to perform procedures of the FCM’s or IB’s customer identification program (“CIP”) prior to the time that CTAs become subject to a final AMLP Rule. This matter has been referred to the Division of Cle aring and Intermediary Oversight (“Division”) for response.