HOW ARE FUTURES BROKERS REGULATED & LICENSED?
A. All futures industry related operations and personnel are strictly regulated and licensed by the CFTC – a federal agency operating at the direction of Congress. This agency works alongside to the Securities & Exchange Commission (SEC) that regulates stock exchanges and personnel. The CFTC has transferred many of its regulatory powers to the NFA. The NFA has been designated as a “registered futures association” under the provisions of the Commodity Futures Trading Commission Act of 1974. The NFA officially began operations on October 1, 1982. The primary purpose of the NFA is to ensure, through self-regulation, high standards of professional conduct and financial responsibility on the part of the individuals and organizations that are its members: Futures Commission Merchants, Introducing Brokers, Commodity Trading Advisors, Commodity.
