On October 23, 2014, the U.S. Commodity Futures Trading Commission’s (“CFTC”) Division of Swap Dealer and Intermediary Oversight issued an interpretation disclosing that a futures commission merchant (“FCM”) may credit a customer’s futures, foreign futures, and/or cleared swaps trading account for a margin payment upon the FCM’s initiation of a withdrawal from the customer’s bank account using the Automated Clearing House (“ACH”) transaction system.  A written agreement between the customer and the FCM would authorize the FCM to institute an ACH transaction to withdraw funds from the customer’s bank account to meet a margin call. CFTC regulations do not require an FCM to delay crediting the relevant customer’s trading account until the check clears such customer’s bank account.

The interpretation pertains to CFTC regulations 1.22, 22.2 and 30.7 and is aligned with a previous staff interpretation regarding the FCM’s procedure for recording checks deposited by customers for margin payments.

The CFTC staff letter is available here:

http://www.cftc.gov/ucm/groups/public/@lrlettergeneral/documents/letter/14-129pdf.