**Editor’s Note: As news content and technology continue to change, so do we at John Lothian News. Please take a look at our interview with Dan Roth of the NFA, and click on the embedded video sidebar, at the 1:09 or 3:40 minute, marks to see more of our interview.
After the twin scandals of MF Global and Peregrine Financial rocked the futures industry in 2011 and 2012, the National Futures Association, underwent a review, not only of its internal procedures, but also of its rules. In Part One of this two-part John Lothian News exclusive, NFA CEO Dan Roth points to a study conducted by the Berkeley Research Group of NFA’s audit procedures, and he reviews the changes made to the way the agency audits, hires employees, and delivers its message to NFA members.
“The Berkeley Research Group actually found that our training was pretty good,” says Roth, “but we felt internally that we could do a better job and adapt a more systematic approach to training.” He points to three changes made to training procedures – better documentation of examiner training segments, enhancing training seminars from people within the industry, and mandating Certified Fraud Examiner training. Roth says they have also made a more concentrated effort to recruit more experienced people from the industry to act as examiners.
At the same time, the NFA has gotten more aggressive in terms of getting its message out to its members and the trading community at large. “We have done six town hall meetings across the country this year with our members, and we make sure that at least one of our public directors is there.” “Members are encouraged to ask questions not only of staff on regulatory issues,” he says, but that the public directors are there to hear them as well.
While the NFA has moved toward greater transparency, transparency has its limits, and some board matters need to happen outside the public eye. “You want to foster a rich dialogue at these meetings, and if everything is open to the public you could have a chilling effect on the deliberative process. It’s a balance.”
Finally, Roth points to an upcoming long-range planning meeting as a sign the agency is trying to assess upcoming changes and how they may impact NFA members. “It’s an ongoing process. It’s never dull.”