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Commodity Futures Trading Commission

May 26, 2010

We sometimes receive questions and complaints about futures trading. A futures contract is an agreement to buy or sell a specific quantity of a commodity or financial instrument at a specified price on a particular date in the future. Commodities include bulk goods, such as grains, metals, and foods, and financial instruments include U.S. and foreign currencies. The SEC administers and enforces the federal laws that govern the sale and trading of securities, such as stocks, bonds, and mutual funds, but we do not regulate futures trading. We refer questions and complaints about futures to the Commodity Futures Trading Commission (CFTC)—the federal agency that does regulate futures trading.

With limited exceptions, the trading of futures must be executed on the floor of a commodity exchange. Similar to broker-dealers that are members of the Financial Industry Regulatory Authority, or some other self-regulatory organization, all firms and individuals who trade futures with the public or give advice about futures trading must be registered with the National Futures Association (NFA).

For more information about the CFTC, you can view its website at If you have a question or complaint about futures trading, you can use the CFTC’s online questionnaire form. You also can find information on the NFA website about filing a complaint with the NFA and how to resolve a dispute.

The CFTC cautions investors to be wary of websites that purport to offer high yield investment opportunities in futures and options, forex, hedge fund, or precious metals, common areas of internet fraud. The CFTC has posted several fictitious websites that are representative of typical websites that have been the subject of CFTC enforcement actions. These examples include some of the hallmarks of commodity futures fraud. CFTC's examples of fraudulent websites include Global Financial Capital Management, Colfax Trading International, TradeForex4You, White, Truman and Fischer, Excalibier Precious Metals, and Commodity

Before you engage an investment professional or purchase commodities, make sure you research and verify all information:

The Office of Investor Education and Advocacy has provided this information as a service to investors. It is neither a legal interpretation nor a statement of SEC policy. If you have questions conce
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