Looking for a Job? The NFA is Hiring

The NFA has announced that they approved their Fiscal Year 2014 budget. The budget, for the fiscal year which starts on July, 1 2013 is for $74 million, an 18% increase above last year. The NFA claimed that “one reason for the significant rise in spending is due to the registration and monitoring of new swap dealer (SD) and major swap participant (MSP) Members.” They added that they are also hiring additional staff to handle the increase of oversight requirements.

Additional oversight also come as the NFA announced earlier this year that they were applying recommendations from the Berkeley Research Group (BRG), and independent audit committee that evaluated the Self Regulating Organization (SRO) after its failure to prevent the MF Global and PFG frauds. The BRG recommended greater training of NFA members and monitoring policies.

The NFA also added that “the influx of about 1,000 new commodity pool operator (CPO) Members after the CFTC CFTC The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss Read this Term last year eliminated numerous widely held CPO exemptions” would further lead to higher expenses for the upcoming fiscal year. Similarly, they mentioned that “the CFTC amended the definitions of CPO, commodity trading advisor and introducing broker to include Swaps Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Read this Term. If these entities engage in swap activities, they will be required to register with the CFTC, which will result in a further increase in NFA membership.”

As a result, it was stated that the additional regulatory responsibilities as well as abovementioned training and monitoring would lead to “the need for additional staffing”. On this, the NFA anticipates the hiring of about 100 employees for the coming fiscal year and attributes the budget’s increase to mainly be due to additional headcount. They added that the SRO is expanding its Chicago office and leasing new space in New York.

Commenting on the budget increase, David Hawrysz, NFA's senior vice president, CFO and treasurer stated “given NFA's current expansion, there are many more variables to consider when constructing the budget. For that reason, the Fiscal Year 2014 budget process was especially challenging."