|
U.S. Code as of:
01/03/05
Section 6d. Dealing by unregistered futures commission merchants or introducing brokers prohibited; duties in handling customer receipts; rules to avoid duplicative regulations
(a) Registration requirements; duties of merchants in handling
customer receipts
It shall be unlawful for any person to engage as futures
commission merchant or introducing broker in soliciting orders or
accepting orders for the purchase or sale of any commodity for
future delivery, or involving any contracts of sale of any
commodity for future delivery, on or subject to the rules of any
contract market or derivatives transaction execution facility
unless -
(1) such person shall have registered, under this chapter, with
the Commission as such futures commission merchant or introducing
broker and such registration shall not have expired nor been
suspended nor revoked; and
(2) such person shall, if a futures commission merchant,
whether a member or nonmember of a contract market or derivatives
transaction execution facility, treat and deal with all money,
securities, and property received by such person to margin,
guarantee, or secure the trades or contracts of any customer of
such person, or accruing to such customer as the result of such
trades or contracts, as belonging to such customer. Such money,
securities, and property shall be separately accounted for and
shall not be commingled with the funds of such commission
merchant or be used to margin or guarantee the trades or
contracts, or to secure or extend the credit, of any customer or
person other than the one for whom the same are held: Provided,
however, That such money, securities, and property of the
customers of such futures commission merchant may, for
convenience, be commingled and deposited in the same account or
accounts with any bank or trust company or with the clearing
house organization of such contract market or derivatives
transaction execution facility, and that such share thereof as in
the normal course of business shall be necessary to margin,
guarantee, secure, transfer, adjust, or settle the contracts or
trades of such customers, or resulting market positions, with the
clearinghouse organization of such contract market or derivatives
transaction execution facility or with any member of such
contract market or derivatives transaction execution facility,
may be withdrawn and applied to such purposes, including the
payment of commissions, brokerage, interest, taxes, storage, and
other charges, lawfully accruing in connection with such
contracts and trades: Provided further, That in accordance with
such terms and conditions as the Commission may prescribe by
rule, regulation, or order, such money, securities, and property
of the customers of such futures commission merchant may be
commingled and deposited as provided in this section with any
other money, securities, and property received by such futures
commission merchant and required by the Commission to be
separately accounted for and treated and dealt with as belonging
to the customers of such futures commission merchant: Provided
further, That such money may be invested in obligations of the
United States, in general obligations of any State or of any
political subdivision thereof, and in obligations fully
guaranteed as to principal and interest by the United States,
such investments to be made in accordance with such rules and
regulations and subject to such conditions as the Commission may
prescribe.
(b) Duties of clearing agencies, depositories, and others in
handling customer receipts
It shall be unlawful for any person, including but not limited to
any clearing agency of a contract market or derivatives transaction
execution facility and any depository, that has received any money,
securities, or property for deposit in a separate account as
provided in paragraph (2) of this section,(!1) to hold, dispose of,
or use any such money, securities, or property as belonging to the
depositing futures commission merchant or any person other than the
customers of such futures commission merchant.
(c) Rules to avoid duplicative regulation of dual registrants
Consistent with this chapter, the Commission, in consultation
with the Securities and Exchange Commission, shall issue such
rules, regulations, or orders as are necessary to avoid duplicative
or conflicting regulations applicable to any futures commission
merchant registered with the Commission pursuant to section 6f(a)
of this title (except paragraph (2) thereof), that is also
registered with the Securities and Exchange Commission pursuant to
section 78o(b) of title 15 (except paragraph (11) thereof),
involving the application of -
(1) section 78h, section 78o(c)(3), and section 78q of title 15
and the rules and regulations thereunder related to the treatment
of customer funds, securities, or property, maintenance of books
and records, financial reporting or other financial
responsibility rules (as defined in section 78c(a)(40) of title
15), involving security futures products; and
(2) similar provisions of this chapter and the rules and
regulations thereunder involving security futures products.
|
|