CFTC orders commodity pool operator exemptions of 17 entities to be ineffective

The United States Commodity Futures Trading Commission (CFTC) on Friday announced it issued an order deeming the commodity pool operator (CPO) exemptions of 17 entities to be ineffective following a special call by the Division of Swap Dealer and Intermediary Oversight (DSIO). The order was approved by the Commission on July 7, 2020 and is effective immediately.

“This Commission action, and the related use of its special call authority, sends a strong message that we take our registration and exemption regime seriously,” said DSIO Director Joshua B. Sterling. “This regime is fundamental to our oversight of market participants, and we are dedicated to ensuring its integrity and to reacting swiftly when firms fail to comply with the rules.”

Each of the entities, purportedly based abroad, had claimed an exemption from CPO registration in accordance with Commission Regulation 4.13(a)(2), which provides that a person is not required to register as a CPO if:

• none of the pools it operates has more than 15 participants at any time; and
• the total gross capital contributions it receives for units of participation in all of the pools it operates or that it intends to operate do not in the aggregate exceed $400,000.

The special call was initiated in accordance with Commission Regulation 4.13(c)(1)(iii), which requires persons claiming an exemption to submit to such special calls as the Commission may make to demonstrate eligibility for and compliance with the applicable criteria for exemption.

“Working with the National Futures Association (NFA), we identified credible reason to believe that certain entities may have claimed the exemption without meeting the eligibility criteria,” added DSIO Deputy Director Amanda Olear.

Each of the entities named in the order failed to comply with its obligation to respond to the special call, which led the CFTC to determine their claimed exemptions ineffective.

Each named entity’s claimed exemption has been withdrawn from NFA’s records:

1. 123 SAHN RHW

2. AE GLOBAL LIMITED

3. AMTO SECURITIES LTD

4. ASFX CAPITAL LIMITED

5. BEST TRADER TECHNOLOGY LIMITED

6. BONUS FINANCE PTY LTD

7. DPI INTERNATIONAL PTY LTD

8. FXZOOM GLOBAL CO LTD

9. GLOBAL NEW TRADE LIMITED

10. HUIYING GLOBAL PTY LIMITED

11. INTAN TECHNOLOGY CO LTD

12. JAG MARKETS LIMITED

13. MANOVITCH GROUP CO LIMITED

14. PHIL INTERNATIONAL LIMITED

15. POCKETECH PTY LTD

16. YESJAL KSIAL LIMITED

17. YOLID LIMITED