Supervision Guidelines In Foreign Exchange

In this article, we are going to list and talk about some of the main supervision guidelines in foreign exchange. These guidelines are set by the authorities responsible for maintaining the entire foreign exchange trading business. These are the standards set in order to make the entire process smooth and to avoid any discrepancies. Knowing about supervision guidelines in forex helps traders in carrying out their work in a better way.

Let us take a look at the following guidelines for Supervision in foreign exchange.

1. The primary supervision guidelines in foreign exchange state that there should be a compliance officer, whose prime responsibility would be to handle customer complaints or inquiries of a compliance nature. He should provide all the necessary help to consumers in their compliance regarding queries.

2. There should be proper policies and procedures to take care of complaints and inquiries of customers.

3. A proper compliance procedures manual and other written documents outlining member’s policy with respect to handling compliance matters, such as customer complaints or inquiries should be maintained.

4. There should be a proper and systematic method in place for recording, investigating and responding to customer complaints or inquiries.

5. All the branches must forward any of the complaints registered with them to the home office or the head office.

6. There should be an Internal Audit Department or other designated auditor officer to monitor all the branches and guaranteed IBs.

7. The auditor officer must be given the responsibility for conducting on-site inspections of branch offices and guaranteed IBs.

8. According to Supervision guidelines in forex, the annual on-site inspections must be done in a proper way.

9. A written audit program report must be drafted while conducting on-site inspections.

10. The supervision guidelines in foreign exchange also state that there should be well written summaries of findings be prepared and all the details must be noted during on-site inspections of branch offices and guaranteed IBs.

11. There should be a well defined procedure to take appropriate corrective action in the event the auditor finds problems at a branch or guaranteed IB.

12. If there is a pre-dispute agreement is included in the customer account documentation, the customers must be provided with a list of three forums, one of which is NFA arbitration, in the event the customer gives notice of its intent to file a claim.

An officer or other supervisory personnel must be assigned the duty to regularly review trading in non-customer and proprietary trading accounts.