CFTC fines Introducing Broker $50,000 for failed record keeping

New World Holdings destroyed business records and failed to diligently supervise employees

Chicago based introducing broker New World Holdings (NWH) has been imposed a fine by the US Commodity Futures trading commission as it failed to keep proper records of its customers and neglected employee supervision. The monetary penalty amounts to $50,000 while the court has also prohibited the company from violating the Commodity Exchange Act and CFTC regulations in the future.

The complaint against the company has been filed by the regulator back in July 2010 and included personal allegations against the company’s principal at the time Steven David Erdman and branch manager Grace Elizabeth Reisinger who were charged for contributing to the failure of the company to maintain proper business records.

According to the court order, NWH introduced an account named under Idylic Solutions Pty Ltd. and various pooled accounts to a Futures commission Merchant starting in March 2006. Individuals who opened the pooled accounts were associated to the same people who held the Idylic account. The total amount of funds that were deposited to the accounts in question was more than $21 million.

The court determined that the company has failed to keep records related to the accounts in question including but not limited to email messages and said records. NWH’s association with dealings with commodity futures, options and cash commodities requires it to keep these records for at least five years.

For the full press release visit CFTC’s website.

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