MFA, Industry Submit Request for Revised CFTC Guidance on Parallel Managed Accounts

On January 27, MFA, ICI, IAA and AIMA filed a letter with CFTC staff requesting for revised guidance with respect to the CFTC’s responses regarding the treatment of parallel managed accounts, reporting of monthly rates of return and spot currency positions in its  FAQs to Form CPO-PQR.  Specifically, we urged the CFTC to revise the following FAQs and clarify that:

(1)    a CPO should not aggregate parallel managed accounts to a related pool for reporting purposes (FAQ 7, 15 and 16);

(2)    a CPO needs to report monthly rates of return for a pool only if such results are calculated on a monthly basis (FAQs 29, 30 and 31); and

(3)    consistent with previous CFTC interpretations, a foreign exchange transaction with a settlement period longer than two business days may be considered a bona fide spot transaction depending on the customary settlement deadline of the relevant market (FAQ 42).

In addition, we are requesting that the Commission delay the implementation of the FAQs until the first quarter 2016 filing while the Associations work with the CFTC staff to address the issues raised in our letter.