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By Opalesque:

On April 21, 2025, the National Futures Association (NFA) submitted an interpretive notice to the CFTC that establishes minimum standards for NFA members' supervision of Associated Persons (APs). This guidance affects NFA Compliance Rules 2-9(a) and (d), 2-36(e), and 2-51(d) and could become effective imminently.

Global law firm K&L Gates has just released a US Asset Management and Investment Funds Alert detailing the requirements of the new guidance and its implications.

Key requirements of the new guidance

The notice requires NFA members to implement a written Supervisory Framework that must:

1. Be tailored to each firm's specific business and risks 2. Apply to all commodity interest and digital asset commodity activities 3. Include appropriate measures for remote workers 4. Identify responsible parties for each supervisory function 5. Incorporate due diligence procedures to ensure AP qualification

For each AP activity, the framework must specify:

• Procedures to identify potential noncompliance • Escalation and resolution procedures • Frequency of supervisory tasks • Recordkeeping policies demonstrating implementation

The guidance emphasizes monitoring communication channels and trading activities, including reviewing daily trade reports and comparing trading results among customers to identify potential misconduct.

The broader conte......................

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