Commodity Futures Law
Thomas F. Burke has represented futures commission merchants (futures brokerage houses), associate persons and investors in lawsuits in state and federal court, at Commodity Futures Trading Commission Administrative Law cases, before futures exchanges and in arbitrations at the National Futures Association (“NFA”) and the American Arbitration Association (“AAA”) in cases related to trading in futures and options on futures contracts for over 30 years.
A futures contract is a standardized contract between two parties to buy or sell a specified asset of standardized quantity and quality for a price with delivery and payment at a date in the future. Traditional commodity futures contracts were based on underlying agricultural products such as corn, soybeans, sugar and wheat and resources such as gold, silver, copper and oil. More recent underlying products have included currencies, securities and financial instruments.
Options on futures contracts are often called “futures options”. A call option gives the purchaser the right, but not the obligation, to purchase the underlying futures contract at a specific strike price and a put option gives the purchaser the right, but not the obligation, to sell a futures contract at a specific strike price. Futures contracts and options on futures contracts are bought and sold at futures exchanges.
Futures are governed by the Commodity Exchange Act (“CEA”), which has been amended several times since its passage in 1936. The primary regulator which is charged with enforcement and administration of the futures laws is the Commodity Futures Trading Commission (“CFTC”). The CFTC has authority to establish regulations that are published in Title 17 of the Code of Federal Regulations. In addition to the CFTC, the National Futures Association (“NFA”) is a self-regulatory organization that promulgates rules and takes enforcement action against its members for wrongful conduct. Additionally, the futures exchanges monitor the activities of futures trading.
If you need advice on the law relating to futures transactions, rules and/or regulations, contact Thomas F. Burke, P.C. at 312/362-1300 or by email at tburke104@att.net.