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Can you summarize 12 CFR Part 240?
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM > RETAIL FOREIGN EXCHANGE TRANSACTIONS (REGULATION NN)
Short Summary
This part of the Code of Federal Regulations, issued by the Board of Governors of the Federal Reserve System, establishes rules applicable to retail foreign exchange transactions engaged in by banking institutions. It applies to banking institutions and their branches or offices, as well as subsidiaries of banking institutions organized under the laws of the United States or any U.S. state. However, retail foreign exchange transactions between a foreign branch or office of a banking institution and a non-U.S. customer are exempted from certain sections of this part. The purpose of this part is to regulate such transactions conducted by banking institutions on or after May 13, 2013. The document provides definitions for various terms related to retail foreign exchange transactions and clarifies exemptions for certain persons described in specific items of section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act. It also establishes requirements for prior written notice to the Board of Governors of the Federal Reserve System before commencing a retail forex business, handling offsetting positions, providing disclosure statements to customers, recordkeeping, capital requirements, margin requirements, monthly statements, trading and operational standards, supervision, assignment and transfer of positions, and dispute resolution. The document does not specify any penalties for non-compliance or violations.
Whom does it apply to?
This part applies to banking institutions and their branches or offices, as well as subsidiaries of banking institutions organized under the laws of the United States or any U.S. state. However, retail foreign exchange transactions between a foreign branch or office of a banking institution and a non-U.S. customer are exempted from certain sections of this part.
What does it govern?
This part of the Code of Federal Regulations governs retail foreign exchange transactions engaged in by banking institutions.
What are exemptions?
Retail foreign exchange transactions between a foreign branch or office of a banking institution and a non-U.S. customer are exempted from certain sections of this part. The foreign branch or office remains subject to the requirements of applicable foreign law for those transactions.
What are the Penalties?
The document does not specify any penalties for non-compliance or violations.
Jurisdiction
U.S. Federal Government