The regulation of the Forex market in the US

In the United States, services for the derivative financial instruments whose underlying assets are currency rates resulting from trading in the interbank market FOREX, mainly offers futures brokers, licensed futures commission merchant (FCM) and retail FOREX- dealers licensed retail foreign exchange dealer (RFED). In the USA the historically distribution of spheres of regulation, according to which the futures market, mainly under the jurisdiction of the Commission by the Commodity Futures Trading (Commodity Futures Trading Commission, CFTC), and self-regulatory organization - the National Futures assotsiaitsii (National Futures Association, NFA). FCM and RFED are licensed CFTC, and also become members of the self-regulatory organization NFA. Control sets the minimum amount of own funds of the company, which today must be not less than 22 mln. US dollars. In addition, companies are required to maintain the size of its own funds in the amount of five percent of their commitments in excess of the minimum value. By FCM and RFED also the requirements of the internal documents and policies governing internal controls, risk management, detailing the relationship with customers, as well as the presence of the Comptroller (compliance officer).

An important feature of the work of American FOREX-companies is that the customer is given a contract to sign a form of risk communication, the text of which shall be approved by the regulator. Apart from the general ban on fraudulent activities in the United States there are a number of specific prohibitions concerning, for example, conduct transactions at non-market prices, expanding the spread between the bid price and the ask, and the ban on direct transactions, the resolution of which has been received from the client indicating the type of navigation tools and volume. FCM and RFED required to provide the relevant units of CFTC and NFA financial records, and information on compliance with regulations in the form of annual and periodic reporting. NFA, in turn, conducts an annual audit of all FCM and RFED. In addition to the standards and rules set by the regulator in relation to derivative transactions, the United States has a system FORTRESS (Forex Transaction Reporting Execution Surveillance System), which is used as a tool for NFA automatic analysis of FOREX-companies and detect violations.

The system records all transactions and client functions as a single register. The report on trading transactions contain all its main characteristics, such as the time, the price at which the transaction was opened and closed, trading volume and others, which gives the regulator the ability to automatically detect deviations from normal market conditions. Capital requirements, the range of activities available to different types of customers, to the size of the margin shoulder, permitted for clients, regulatory and enforcement policy are different for FCM and RFED, on the one hand, and brokers - dealers who trade on the stock market, on the other. The interim rule SEC (US Securities and Exchange Commission) allows registered brokers also offer retail services (OTC) Forex. An integral feature of the American system of regulation is usually set limits on the amount of leverage provided by FOREX retail customers.

We can assume that it is this restriction leads to some stagnation in the industry in the United States, since the lack of opportunity associated with margin lending, OTC FOREX deprives the main advantages and does not stand out compared to other financial markets. To date, the total amount of liabilities of companies offering services to retail clients trading in the OTC segment of the FOREX market to customers in the United States is according to various estimates about 800 million US dollars. The majority of this amount relates to the obligations of the five largest companies, the number of active clients ranging from 20 to 100 thousand people.