Blog article
See all stories »

Become a master of suspense

Starting October 1, 2018, CME Regulatory Advisory RA1720-5 comes into effect. The advisory details the limited use of suspense accounts, which are temporary holding accounts submitted at the time of order entry into Globex, but prior to the allocation of the executions to specific accounts on a carrying clearing member’s books. Only a de minimis use of general or non-customer specific suspense accounts is permitted, and their usage has specific requirements.

As the CME routinely reviews suspense account use, firms would be well advised to familiarize themselves with the circumstances of when and how a suspense account can be used. It appears from the FAQ of the advisory that the CME is expecting to see a robust compliance framework as there is a lengthy list of potential violations, including the failure to maintain or adhere to firm procedures around suspense account usage.

FCMs will need to ensure that they have sufficiently mastered the requirements of the advisory and have established comprehensive procedures to reduce the suspense of a CME account review.



Comments: (0)

Now hiring