Appendix E to Part 30 - Acknowledgment Letter for CFTC Regulation 30.7 Customer Secured Account
17:1.0.1.1.23.0.7.14.26 : Appendix E
Appendix E to Part 30 - Acknowledgment Letter for CFTC Regulation
30.7 Customer Secured Account
[Date]
[Name and Address of Depository]
We refer to the Secured Amount Account(s) which [Name of Futures
Commission Merchant] (“we” or “our”) have opened or will open with
[Name of Depository] (“you” or “your”) entitled:
[Name of Futures Commission Merchant] [if applicable, add “FCM
Customer Omnibus Account”] CFTC Regulation 30.7 Customer Secured
Account under Section 4(b) of the Commodity Exchange Act [and, if
applicable, “, Abbreviated as [short title reflected in the
depository's electronic system]”]
Account Number(s): [ ] (collectively, the “Account(s)”).
You acknowledge that we have opened or will open the
above-referenced Account(s) for the purpose of depositing, as
applicable, money, securities and other property (collectively
“Funds”) of customers who trade foreign futures and/or foreign
options (as such terms are defined in U.S. Commodity Futures
Trading Commission (“CFTC”) Regulation 30.1, as amended); that the
Funds held by you, hereafter deposited in the Account(s) or
accruing to the credit of the Account(s), will be kept separate and
apart and separately accounted for on your books from our own funds
and from any other funds or accounts held by us, in accordance with
the provisions of the Commodity Exchange Act, as amended (the
“Act”), and part 30 of the CFTC's regulations, as amended; that the
Funds may not be commingled with our own funds in any proprietary
account we maintain with you; and that the Funds must otherwise be
treated in accordance with the provisions of Section 4(b) of the
Act and CFTC Regulation 30.7.
Furthermore, you acknowledge and agree that such Funds may not
be used by you or by us to secure or guarantee any obligations that
we might owe to you, and they may not be used by us to secure or
obtain credit from you. You further acknowledge and agree that the
Funds in the Account(s) shall not be subject to any right of offset
or lien for or on account of any indebtedness, obligations or
liabilities we may now or in the future have owing to you. This
prohibition does not affect your right to recover funds advanced in
the form of cash transfers, lines of credit, repurchase agreements
or other similar liquidity arrangements you make in lieu of
liquidating non-cash assets held in the Account(s) or in lieu of
converting cash held in the Account(s) to cash in a different
currency.
In addition, you agree that the Account(s) may be examined at
any reasonable time by the director of the Division of Swap Dealer
and Intermediary Oversight of the CFTC or the director of the
Division of Clearing and Risk of the CFTC, or any successor
divisions, or such directors' designees, or an appropriate officer,
agent or employee of our designated self-regulatory organization
(“DSRO”), [Name of DSRO], and this letter constitutes the
authorization and direction of the undersigned on our behalf to
permit any such examination to take place without further notice or
consent from us.
You agree to reply promptly and directly to any request for
confirmation of account balances or provision of any other
information regarding or related to the Account(s) from the
director of the Division of Swap Dealer and Intermediary Oversight
of the CFTC or the director of the Division of Clearing and Risk of
the CFTC, or any successor divisions, or such directors' designees,
or an appropriate officer, agent, or employee of [Name of DSRO],
acting in its capacity as our DSRO, and this letter constitutes the
authorization and direction of the undersigned on our behalf to
release the requested information without further notice to or
consent from us.
You further acknowledge and agree that, pursuant to
authorization granted by us to you previously or herein, you have
provided, or will promptly provide following the opening of the
Account(s), the director of the Division of Swap Dealer and
Intermediary Oversight of the CFTC, or any successor division, or
such director's designees, with technological connectivity, which
may include provision of hardware, software, and related technology
and protocol support, to facilitate direct, read-only electronic
access to transaction and account balance information for the
Account(s). This letter constitutes the authorization and direction
of the undersigned on our behalf for you to establish this
connectivity and access if not previously established, without
further notice to or consent from us.
The parties agree that all actions on your part to respond to
the above information and access requests will be made in
accordance with, and subject to, such usual and customary
authorization verification and authentication policies and
procedures as may be employed by you to verify the authority of,
and authenticate the identity of, the individual making any such
information or access request, in order to provide for the secure
transmission and delivery of the requested information or access to
the appropriate recipient(s).
We will not hold you responsible for acting pursuant to any
information or access request from the director of the Division of
Swap Dealer and Intermediary Oversight of the CFTC or the director
of the Division of Clearing and Risk of the CFTC, or any successor
divisions, or such directors' designees, or an appropriate officer,
agent, or employee of [Name of DSRO], acting in its capacity as our
DSRO, upon which you have relied after having taken measures in
accordance with your applicable policies and procedures to assure
that such request was provided to you by an individual authorized
to make such a request.
In the event we become subject to either a voluntary or
involuntary petition for relief under the U.S. Bankruptcy Code, we
acknowledge that you will have no obligation to release the Funds
held in the Account(s), except upon instruction of the Trustee in
Bankruptcy or pursuant to the Order of the respective U.S.
Bankruptcy Court.
Notwithstanding anything in the foregoing to the contrary,
nothing contained herein shall be construed as limiting your right
to assert any right of offset or lien on assets that are not 30.7
customer funds maintained in the Account(s), or to impose such
charges against us or any proprietary account maintained by us with
you. Further, it is understood that amounts represented by checks,
drafts or other items shall not be considered to be part of the
Account(s) until finally collected. Accordingly, checks, drafts and
other items credited to the Account(s) and subsequently dishonored
or otherwise returned to you or reversed, for any reason, and any
claims relating thereto, including but not limited to claims of
alteration or forgery, may be charged back to the Account(s), and
we shall be responsible to you as a general endorser of all such
items whether or not actually so endorsed.
You may conclusively presume that any withdrawal from the
Account(s) and the balances maintained therein are in conformity
with the Act and CFTC regulations without any further inquiry,
provided that, in the ordinary course of your business as a
depository, you have no notice of or actual knowledge of a
potential violation by us of any provision of the Act or part 30 of
the CFTC regulations that relates to the holding of customer funds;
and you shall not in any manner not expressly agreed to herein be
responsible to us for ensuring compliance by us with such
provisions of the Act and CFTC regulations; however, the
aforementioned presumption does not affect any obligation you may
otherwise have under the Act or CFTC regulations.
You may, and are hereby authorized to, obey the order, judgment,
decree or levy of any court of competent jurisdiction or any
governmental agency with jurisdiction, which order, judgment,
decree or levy relates in whole or in part to the Account(s). In
any event, you shall not be liable by reason of any action or
omission to act pursuant to any such order, judgment, decree or
levy, to us or to any other person, firm, association or
corporation even if thereafter any such order, decree, judgment or
levy shall be reversed, modified, set aside or vacated.
The terms of this letter agreement shall remain binding upon the
parties, their successors and assigns and, for the avoidance of
doubt, regardless of a change in the name of either party. This
letter agreement supersedes and replaces any prior agreement
between the parties in connection with the Account(s), including
but not limited to any prior acknowledgment letter agreement, to
the extent that such prior agreement is inconsistent with the terms
hereof. In the event of any conflict between this letter agreement
and any other agreement between the parties in connection with the
Account(s), this letter agreement shall govern with respect to
matters specific to Section 4(b) of the Act and the CFTC's
regulations thereunder, as amended.
This letter agreement shall be governed by and construed in
accordance with the laws of [Insert governing law] without regard
to the principles of choice of law.
Please acknowledge that you agree to abide by the requirements
and conditions set forth above by signing and returning to us the
enclosed copy of this letter agreement, and that you further agree
to provide a copy of this fully executed letter agreement directly
to the CFTC (via electronic means in a format and manner determined
by the CFTC) and to [Name of DSRO], acting in its capacity as our
DSRO. We hereby authorize and direct you to provide such copies
without further notice to or consent from us, no later than three
business days after opening the Account(s) or revising this letter
agreement, as applicable.
[Name of Futures Commission Merchant] By: Print Name: Title:
ACKNOWLEDGED AND AGREED: [Name of Depository] By: Print Name:
Title: Contact Information: [Insert phone number and email address]
DATE: [79 FR 14174, Mar. 13, 2014]