Broker Qualifications
Technically, the person most people refer to as their "commodity broker" is an Associated Person.  He works for the brokerage firms and generally he is the person who takes your calls, places your orders, reports back to you when the order is filled, and for the most part handles your trading account.  Before he can conduct business, he is required to pass the National Commodity Futures Exam, register with the Commodity Futures Trading Commission (CFTC) and be a member of the National Futures Association (NFA), which conducts a background check.

Discretionary Accounts
These accounts give brokers limited power of attorney to trade the customer's account entirely, without obtaining the customer's approval for trades.  This authority must be given to the broker in writing.

Opening an Account
Opening a new commodity account requires several forms to be filled out and signed.  The main purpose of these forms are:

• to inform the customer of all the risks associated with futures trading
• to determine the customer's net worth and whether he is financially suited to trade futures
• to give the brokerage firm authority to transfer the customers funds within the firm or to close out the customer's positions if necessary to meet a margin call in the customer's account.

Risk Disclosure
When you first open your account, you will be asked to read and sign a risk disclosure statement.  The purpose of this is to advice you of the risk of loss associated in futures trading and to alert you to the possibility that such trading might not be financially suitable for you.  It basically serves as a warning.

Reports
Written confirmation of each trade is required to be made to you by the following business day.  Usually it arrives in your mailbox a day or two after the day of trading.  Make sure you check your runs and make sure they are correct.  The FCM is also responsible for mailing out a monthly statement as well.

Reparations
If you feel that you have been wronged by a commodity futures professional and are unable to settle the matter with your broker or his firm, there are two other avenues open to you: The CFTC and the NFA.  You can find out more about each organization below.

Contacts:
The two primary entities responsible for regulating the Futures Industry are:

• National Futures Association -- Since our founding in 1982, National Futures Association has been responsible for protecting the rights of investors in the futures markets. 200 West Madison Street, Suite 1600, Chicago, IL 60606, (312) 781-1300, fax (312) 781-1467.

BASIC contains Commodity Futures Trading Commission (CFTC) registration and NFA membership information and futures-related regulatory and non-regulatory actions contributed by NFA, the CFTC and the U.S. futures exchanges.

• Commodity Futures Trading Commission --The Commodity Futures Trading Commission (CFTC), was created by Congress in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States.  3 Lafayette Center, 1155 21st Street, Northwest, Washington, D.C. 20581, (202)254-6387, fax (202)254-3678.