NFA Fines Marex Spectron for Repeat Unregistered Broker Violations

The National Futures Association (NFA) has fined Marex Spectron International Limited $350,000 for permitting unregistered staff to handle orders from U.S. customers, marking the second time in four years the London broker has settled a similar case. 

The NFA's Business Conduct Committee issued the decision on June 30, and Marex Spectron neither admitted nor denied the findings, which involve a breach of an NFA registration rule and a related supervision requirement. The penalty is 40% higher than the $250,000 the firm paid in 2022 after an earlier NFA examination, with both cases centered on the same London energy division. 

Examiners found 14 Marex Spectron brokers soliciting or accepting orders from U.S. customers without registering with the Commodity Futures Trading Commission as associated persons, as required by NFA rules. Thirteen of the 14 worked in London and one in Dubai, handling about 75 trades for 20 U.S. customers between February and April 2024, representing roughly 40% of the brokers on the London energy desk. 

A CFTC exemption allows non-U.S. brokers to skip registration if they deal only with non-U.S. customers, but the NFA stated the 14 individuals did not qualify because their clients were companies formed or headquartered in the United States. 

One example involved a London broker arranging a crude oil contract-for-difference trade in March 2024 for a client identified as an Illinois company based in Chicago. 

The firm's first NFA case, filed in 2022, followed a 2020 examination and named 18 brokers in the same division, also ending in a settlement. The NFA described the repeat findings as "especially troubling" given the earlier complaint, noting the firm had not implemented effective controls to prevent recurrence. Regulators pointed to a broker identified only as Employee 1, flagged in the 2020 examination, whose firm had said a registered colleague would take over his U.S. business but later acknowledged he arranged more than 50 trades for U.S. customers between June 2021 and June 2024 while still unregistered.