Electronic Code of Federal Regulations (e-CFR)
Chapter I. COMMODITY FUTURES TRADING COMMISSION
Part 4. COMMODITY POOL OPERATORS AND COMMODITY TRADING ADVISORS
Eachcommodity pool operatorregistered or required to be registered under the Act must make and keep the following books and records in an accurate, current and orderly manner. Books and records that are not maintained at the pool operators main business office shall be maintained by one or more of the following: the pools administrator, distributor or custodian, or a bank or registeredbrokerordealeracting in a similar capacity with respect to the pool. All books and records shall be maintained in accordance with 1.31. All books and records required by this section except those required by paragraphs (a)(3), (a)(4), (b)(1), (b)(2) and (b)(3) must be made available toparticipantsfor inspection and copying during normal business hours. Upon request, copies must be sent by mail to anyparticipantwithin fivebusiness daysif reasonable reproduction and distribution costs are paid by the poolparticipant. If the books and records are maintained at thecommodity pool operators main business office that is outside the United States, its territories or possessions, then upon the request of aCommissionrepresentative, the pool operator must provide such books and records as requested at the place in the United States, its territories or possessions designated by the representative within 72 hours after the pool operator receives the request.
(a)Concerning the commodity pool:(1) An itemized daily record of eachcommodity interesttransaction of the pool, showing the transaction date, quantity,commodity interest, and, as applicable, price orpremiumdelivery monthor expiration date, whether a put or a call, strike price, underlying contract forfuture deliveryor underlyingcommodityswaptype and counterparty, thefutures commission merchantand/or retail foreign exchangedealercarrying the account and theintroducing broker, if any, whether thecommodity interestwas purchased, sold (including, in the case of a retail forex transaction, offset), exercised, expired (including, in the case of a retail forex transaction, whether it was rolled forward), and the gain or loss realized.
(2)A journal of original entry or other equivalent record showing all receipts and disbursements of money, securities and other property.
(3)The acknowledgement specified by 4.21(b)for eachparticipantin the pool.
(4)A subsidiary ledger or other equivalent record for eachparticipantin the pool showing theparticipants name and address and all funds, securities and other property that the pool received from or distributed to theparticipant. This requirement may be satisfied through a transfer agents maintenance of records or through a list of relevant intermediaries where shares are held in anomnibus accountor through intermediaries.
(5)Adjusting entries and any other records of original entry or their equivalent forming the basis of entries in any ledger.
(6)A general ledger or other equivalent record containing details of all asset, liability, capital, income and expense accounts.
(7)Copies of eachconfirmationor acknowledgment of acommodity interesttransaction of the pool, and each purchase and sale statement and each monthly statement for the pool received from afutures commission merchant, retail foreign exchangedealerorswap dealer.
(8)Cancelled checks, bank statements, journals, ledgers, invoices, computer generated records, and all other records, data and memoranda prepared or received in connection with the operation of the pool.
(9)The original or a copy of each report, letter, circular, memorandum, publication, writing, advertisement or other literature or advice (including the texts of standardized oral presentations and of radio, television, seminar or similar mass media presentations) distributed or caused to be distributed by thecommodity pool operatorto any existing or prospective poolparticipantor received by the pool operator from anycommodity trading advisorof the pool, showing the first date of distribution or receipt if not otherwise shown on the document.
(10)A Statement of Financial Condition as of the close of(i)each regular monthly period if the pool had net assets of $500,000 or more at the beginning of the pools fiscal year, or(ii)each regular quarterly period for all other pools. The Statement must be completed within 30 days after the end of that period.
(11)A Statement of Income (Loss) for the period between(i)the later of: (A) the date of the most recent Statement of Financial Condition furnished to theCommissionpursuant to 4.22(c), (B) April 1, 1979 or (C) the formation of the pool, and(ii)the date of the Statement of Financial Condition required byparagraph (a)(10)of this section. The Statement must be completed within 30 days after the end of that period.
(12)A manually signed copy of each Account Statement and Annual Reportprovidedpursuant to 4.22, 4.7(b) or 4.12(b), and records of the key financial balances submitted to the National Futures Association for eachcommoditypool Annual Report, which records must clearly demonstrate how the key financial balances were compiled from the Annual Report.
(b)Concerning the commodity pool operator:(1) An itemized daily record of eachcommodity interesttransaction of thecommodity pool operatorand each principal thereof, showing the transaction date, quantity,commodity interest, and, as applicable, price orpremiumdelivery monthor expiration date, whether a put or a call, strike price, underlying contract forfuture deliveryor underlyingcommodityswaptype and counterparty, thefutures commission merchantor retail foreign exchangedealercarrying the account and theintroducing broker, if any, whether thecommodity interestwas purchased, sold, exercised, or expired, and the gain or loss realized;Provided, however,that if the pool operator is a counterparty to aswap, it must comply with theswapdata recordkeeping and reporting requirements ofpart 45of this chapter, as applicable.
(2)Eachconfirmationof acommodity interesttransaction, each purchase and sale statement and each monthly statement furnished by afutures commission merchantor retail foreign exchangedealerto:
(i)Thecommodity pool operatorrelating to a personal account of the pool operator; and
(ii)Each principal of the pool operator relating to a personal account of such principal.
(3)Books and records of all other transactions in all other activities in which the pool operator engages. Those books and records must include cancelled checks, bank statements, journals, ledgers, invoices, computer generated records and all other records, data and memoranda which have been prepared in the course of engaging in those activities.
(c)If the pool operator does not maintain its books and records at its main business office, the pool operator shall:
(1)At the time it registers with theCommissionor delegates its recordkeeping obligations, whichever is later, file a statement that:
(i)Identifies the name, main business address, and main business telephone number of the person(s) who will be keeping required books and records in lieu of the pool operator;
(ii)Sets forth the name and telephone number of a contact for eachpersonwho will be keeping required books and records in lieu of the pool operator;
(iii)Specifies, by reference to the respective paragraph of this section, the books and records that suchpersonwill be keeping; and
(iv)Contains representations from the pool operator that:
(A)It will promptly amend the statement if the contact information or location of any of the books and records required to be kept by this section changes, by identifying in such amendment the new location and any other information that has changed;
(B)It remains responsible for ensuring that all books and records required by this section are kept in accordance with 1.31;
(C)Within 48 hours after a request by a representative of theCommission, it will obtain the original books and records from the location at which they are maintained, and provide them for inspection at the pool operators main business office;Provided, however,that if the original books and records are permitted to be, and are maintained, at a location outside the United States, its territories or possessions, the pool operator will obtain and provide such original books and records for inspection at the pool operators main business office within 72 hours of such a request; and
(D)It will disclose in the pools Disclosure Document the location of its books and records that are required under this section.
(2)The pool operator shall also file electronically with the National Futures Association a statement from eachpersonwho will be keeping required books and records in lieu of the pool operator wherein such person:
(i)Acknowledges that the pool operator intends that thepersonkeep and maintain required pool books and records;
(ii)Agrees to keep and maintain such records required in accordance with 1.31of this chapter; and
(iii)Agrees to keep such required books and records open to inspection by any representative of theCommissionor the United StatesDepartment of Justicein accordance with 1.31of this chapter and to make such required books and records available to poolparticipantsin accordance with this section.
(Secs. 2(a)(1), 4c(a)-(d), 4d, 4f, 4g, 4k, 4m, 4n, 8a, 15 and 17,Commodity Exchange Act7U.S.C.246c(a)-(d), 6f, 6g, 6k, 6m, 6n, 12a, 19 and 21;5U.S.C.552and552b))
[46 FR 26013, May 8, 1981, as amended at46 FR 63035, Dec. 30, 1981;47 FR 57011, Dec. 22, 1982;48 FR 35299, Aug. 3, 1983;60 FR 38183, July 25, 1995;71 FR 8943, Feb. 22, 2006;75 FR 55428, Sept. 10, 2010;77 FR 54358, Sept. 5, 2012;77 FR 66332, Nov. 2, 2012;78 FR 52334, Aug. 22, 2013]