Financial Regulatory Forum

U.S. CFTC ends relief on ag position limits for 2 firms, vows consistent enforcement

By Reuters Staff
August 19, 2009

USA/

WASHINGTON, Aug 19 (Reuters) – The U.S. Commodity Futures Trading Commission said on Wednesday it was withdrawing no-action letters that provided relief to two firms from federal agricultural speculative positions limits for soybeans, corn and wheat futures contracts.

“I believe that position limits should be consistently applied and vigorously enforced,” said CFTC Chairman Gary Gensler. “Position limits promote market integrity by guarding against concentrated positions.”

The CFTC said relief was ended for Deutsche Bank AG’s commodity pool operator and commodity trading advisor that allowed DB Commodity Index Tracking Master Fund to take positions in corn and wheat futures that exceed federal speculative position limits.

The agency said it was also ending exemptions from position limits for an unnamed commodity pool operator/commodity trading advisor “employing a proprietary commodity investment strategy” that includes positions in Chicago Board of Trade corn, soybeans and wheat futures contracts.

The CFTC said it will work with the affected firms “as they transition to positions within current federal speculative limits.”

The CFTC said the withdrawal of relief from federal speculative position limits is very specific and limited and does not affect other market participants.

(Reporting by Tom Doggett; Editing by Marguerita Choy)

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •