From the category archives:

Regulatory Actions

CFTC Uncovers More Frauds and Ponzi Schemes

April 9, 2009

This week alone the Commodities Futures Trading Commission issued 5 separate press releases regarding various frauds and ponzi schemes.   As we have noted many times before investors should make sure they conduct adequate due diligence into their managers.  It also goes without saying, but managers should not engage in fraudulent conduct, make misrepresentations to investors, [...]

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CPOs and CTAs Now Submit Disclosure Documents Electronically

April 7, 2009

NFAs Electronic Filing System Went Live Yesterday The NFAs new electronic filing system for CPO and CTA disclosure documents went live yesterday.  All NFA members are required to use the electronic system for filing their disclosure documents.   While I have not yet used the new system, it is expected to be a big improvement over [...]

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CFTC Fines BD/FCM For Books and Records Violations

March 31, 2009

Firm Fails to Institute Procedure for Bunched Orders (www.hedgefundlawblog.com) The fines can be hefty for breaking CFTC regulations or NFA rules.  We have seen a large number of actions both with the SEC and the CFTC as well as with the NFA.  Below is another example of a group who has been fined for failing [...]

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NFA Prohibits CPO Firm From Doing Business

March 24, 2009

For Immediate Release For more information contact: Larry Dyekman (312) 781-1372, ldyekman@nfa.futures.org Karen Wuertz (312) 781-1335, kwuertz@nfa.futures.org NFA takes an emergency enforcement action against GlobeFX Club, Inc. March 24, Chicago – National Futures Association (NFA) announced today that it has taken an emergency enforcement action against GlobeFX Club, Inc. (GlobeFX Club), a Commodity Pool Operator [...]

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NASAA Proposes Multi-State No-Action Request Process

March 11, 2009

Currently each state has their own securities laws and their own interpretation of those laws.  While many of the laws and regulations are based on the same set of model rules, no two states seem to take the same interpretation with regard to the rules.  Enforcement is completely different as well.  This presents many problems [...]

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Ponzi Scheme Targets Deaf Community

February 19, 2009

SEC and CFTC Act to Halt New Fraud Another fraud was unveiled today as the SEC and the CFTC worked in conjunction to halt a ponzi scheme which purportedly made great returns by trading in the off-exchange foreign currency (forex) markets.  The scammer was a member of the deaf community and perpetrated the fraud on [...]

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Two Separate CPOs Subject to NFA Action

February 10, 2009

In two separate actions the NFA has effectively shut down two separate Commodity Pool Operators who were operating in the Northeast.  The press releases are reprinted below. **** For Immediate Release NFA takes emergency enforcement action against New York commodity pool operator February 9, Chicago – National Futures Association (NFA) announced today, that it has [...]

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Hedge Fund Best Practices – Full Report

January 19, 2009

Full Report of Best Practices for the Hedge Fund Industry As we discussed in an earlier article on Hedge Fund Best Practices, the President’s Working Group outsourced the creation of best practices for the hedge fund industry.  The report below, reprinted in its entirety, provides a comprehensive review of the major issues which hedge fund [...]

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Hedge Fund Best Practices

January 17, 2009

Private Group Promulgates Hedge Fund Best Practices Under direction from the President’s Working Group on Financial Markets, a private sector group comprised of financial industry professionals and regulators released a finalized set of best practices for hedge funds and hedge fund investors. 

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Investment Advisor Barred From IA Industry For Matching Trade Fraud

December 3, 2008

Hedge fund managers should not match trades between commonly managed accounts in thinly traded (or illiquid) securities as this may pose potential problems under the Investment Advisors Act of 1940.  This holds true whether the hedge fund manager is registered or unregistered.  As the release below shows, the manager may be subject to fines and/or [...]

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