The Commodity Futures Trading Commission and the Financial Crimes Enforcement Network (FinCEN) have issued guidance clarifying the application of customer identification program (CIP) regulations to give-up arrangements. The guidance confirms that, in give-up arrangements, only clearing brokers are subject to CIP requirements. The agencies noted that, although an executing broker in a give-up arrangement facilitates trades for a customer, and the give-up arrangement may be governed by a written agreement, it is only the clearing broker that establishes a formal relationship with the customer for the purposes of the customer identification program rule.
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CFTC and FinCEN issue guidance on application of CIP rules to give-up arrangements
- Katten Muchin Rosenman LLP
- April 20 2007
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