Federal Register, Volume 76, Number 149, August 3, 2011, Pages 46595-47054 Page: 46,667
viii, 47054, iii p. ; 28 cm.View a full description of this periodical.
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Federal Register/Vol. 76, No. 149/Wednesday, August 3, 2011 /Proposed Rules
retail forex counterparty unless the
banking institution:
(1) Receives written authorization
from a person designated by such other
retail forex counterparty with
responsibility for the surveillance over
such account pursuant to paragraph
(a)(2) of this section;
(2) Prepares immediately upon receipt
of an order for the account a written
record of the order, including the
account identification and order
number, and records thereon to the
nearest minute, by time-stamp or other
timing device, the date and time the
order is received; and
(3) Transmits on a regular basis to the
other retail forex counterparty copies of
all statements for the account and of all
written records prepared upon the
receipt of orders for the account
pursuant to paragraph (c)(2) of this
section.
(d) Related person of banking
institution establishing account at
another retail forex counterparty. No
related person of a banking institution
working in the banking institution's
retail forex business may have an
account, directly or indirectly, with
another retail forex counterparty unless
the other retail forex counterparty:
(1) Receives written authorization to
open and maintain the account from a
person designated by the banking
institution of which it is a related
person with responsibility for the
surveillance over the account pursuant
to paragraph (a)(2) of this section; and
(2) Transmits on a regular basis to the
banking institution copies of all
statements for the account and of all
written records prepared by the other
retail forex counterparty upon receipt of
orders for such account pursuant to
paragraph (c)(2) of this section.
(e) Prohibited trading practices. No
banking institution engaging in retail
forex transactions may:
(1) Enter into a retail forex
transaction, to be executed pursuant to
a market or limit order at a price that is
not at or near the price at which other
retail forex customers, during that same
time period, have executed retail forex
transactions with the banking
institution;
(2) Adjust or alter prices for a retail
forex transaction after the transaction
has been confirmed to the retail forex
customer;
(3) Provide a retail forex customer a
new bid price for a retail forex
transaction that is higher than its
previous bid without providing a new
asked price that is also higher than its
previous asked price by a similar(4) Provide a retail forex customer a
new bid price for a retail forex
transaction that is lower than its
previous bid without providing a new
asked price that is also lower than its
previous asked price by a similar
amount; or
(5) Establish a new position for a
retail forex customer (except one that
offsets an existing position for that retail
forex customer) where the banking
institution holds outstanding orders of
other retail forex customers for the same
currency pair at a comparable price.
240.14 Supervision.
(a) Supervision by the banking
institution. A banking institution
engaging in retail forex transactions
shall diligently supervise the handling
by its officers, employees, and agents (or
persons occupying a similar status or
performing a similar function) of all
retail forex accounts carried, operated,
or advised by the banking institution
and all activities of its officers,
employees, and agents (or persons
occupying a similar status or performing
a similar function) relating to its retail
forex business.
(b) Supervision by officers, employees,
or agents. An officer, employee, or agent
of a banking institution must diligently
supervise his or her subordinates'
handling of all retail forex accounts at
the banking institution and all the
subordinates' activities relating to the
banking institution's retail forex
business.
240.15 Notice of transfers.
(a) Prior notice generally required.
Except as provided in paragraph (b) of
this section, a banking institution must
provide a retail forex customer with 30
days' prior notice of any assignment of
any position or transfer of any account
of the retail forex customer. The notice
must include a statement that the retail
forex customer is not required to accept
the proposed assignment or transfer and
may direct the banking institution to
liquidate the positions of the retail forex
customer or transfer the account to a
retail forex counterparty of the retail
forex customer's selection.
(b) Exceptions. The requirements of
paragraph (a) of this section shall not
apply to transfers:
(1) Requested by the retail forex
customer;
(2) Made by the Federal Deposit
Insurance Corporation as receiver or
conservator under the Federal Deposit
Insurance Act; or
(3) Otherwise authorized by
applicable law.
(c) Obligations of transferee bankingwhich retail forex accounts or positions
are assigned or transferred under
paragraph (a) of this section must
provide to the affected retail forex
customers the risk disclosure statements
and forms of acknowledgment required
by this part and receive the required
signed acknowledgments within sixty
days of such assignments or transfers.
This requirement shall not apply if the
banking institution has clear written
evidence that the retail forex customer
has received and acknowledged receipt
of the required disclosure statements.
240.16 Customer dispute resolution.
(a) No banking institution shall enter
into any agreement or understanding
with a retail forex customer in which
the customer agrees, prior to the time a
claim or grievance arises, to submit any
claim or grievance regarding any retail
forex transaction or disclosure to any
settlement procedure.
(b) Election of forum.
(1) Within 10 business days after the
receipt of notice from the retail forex
customer that the customer intends to
submit a claim to arbitration, the
banking institution shall provide the
customer with a list of persons qualified
in dispute resolution.
(2) The customer must, within 45
days after receipt of such list, notify the
national bank of the person selected.
The customer's failure to provide such
notice shall give the banking institution
the right to select a person from the list.
(c) Enforceability. A dispute
settlement procedure may require
parties using the procedure to agree,
under applicable state law, submission
agreement, or otherwise, to be bound by
an award rendered in the procedure if
the agreement to submit the claim or
grievance to the procedure was made
after the claim or grievance arose. Any
award so rendered by the procedure will
be enforceable in accordance with
applicable law.
(d) Time limits for submission of
claims. The dispute settlement
procedure used by the parties may not
include any unreasonably short
limitation period foreclosing submission
of a customer's claims or grievances or
counterclaims.
(e) Counterclaims. A procedure for the
settlement of a retail forex customer's
claims or grievances against a banking
institution or employee thereof may
permit the submission of a counterclaim
in the procedure by a person against
whom a claim or grievance is brought if
the counterclaim:
(1) Arises out of the transaction or
occurrence that is the subject of the
retail forex customer's claim orinstitution. A banking institution to
46667
amount;
grievance; and
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United States. Office of the Federal Register. Federal Register, Volume 76, Number 149, August 3, 2011, Pages 46595-47054, periodical, August 3, 2011; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc52326/m1/81/?rotate=90: accessed May 5, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.