| Necessary Controls Needed over Automated Order-Routing Systems |
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| NFA has recently issued an interpretive notice to NFA Compliance Rule 2-9 regarding supervision over the use of automated order-routing systems ("AORSs"). |
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| Over the past several years, Compliance Supervisors Inc. has seen an increase use of AORSs over the traditional use of using the telephone to execute orders for customers. The technology that is used at different firms generally affects how a client complies with NFA rules and CFTC Regulations. As AORSs become more prevalent, the NFA has stated that it is becoming increasingly important for users of such systems to understand how to adopt controls that apply pre-existing regulatory standards to these systems. |
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| Technology can appear to be rather confusing to many people, especially with establishing the necessary controls to comply with the various standards that NFA is asking the users to adhere to on an on-going basis. These standards are necessary from a prudent business standpoint and will help ensure that client orders are being processed in a safe and secure environment. |
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| If you are a user of AORSs and need assistance with complying with NFA’s interpretative notice to NFA Compliance Rule 2-9 regarding supervision over the use of these systems, feel free to contact us. We will work with you to bring your organization into compliance within a reasonable time. | |
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