MARKET WATCH
| Month |
High |
Low |
Average |
| January 2005 |
6.84 |
6.43 |
6.63 |
| 2004 |
8.21 |
5.51 |
6.67 |
ASSOCIATION NEWS
News:
Meetings:
- SUA Spring Meeting Dates Set
May 17-18 in Washington, DC at the Army-Navy Club.
Anyone interested in sponsoring, please contact Paul Miller at pmiller@mwcapitol.com.
- JCK June 3-7
Las Vegas, NV
Note:
- Please send us any updates to your company profile so that we can update our records and web site.
SILVER USERS ASSOCIATION SPONSORS SILVER AWARDS AT MJSA MEETING
The Silver Users Association would like to congratulate the winners of the MJSA 14th Annual American Vision Award & Design Competition. This year's Silver Distinction Awards were sponsored by SUA. Winners received monetary awards for $500 for first-place and $250 for second-place.
(You can check out the designs on our website at www.silverusersassociation.org as they will be posted later today.)
First Place Silver Distinction
Todd Reed
Todd Reed, Inc.
Boulder, CO
Second Place Silver Distinction
Marie Scarpa
Marie Scarpa Designs
Petaluma, CA
NEW CLEARINGHOUSE APPLIES FOR REGISTRATION TO SERVICE OTC TRADES
AE Clearinghouse has asked the Commodity Futures Trading Commission for registration as a derivatives clearing organization to provide services for excluded over-the-counter derivatives transactions.
To qualify for DCO registration, an applicant has to demonstrate that it complies with 14 core principles detailed in CFTC rules. To show compliance, an applicant must meet certain requirements with respect to financial, operational, and managerial resources, risk management, settlement procedures, treatment of funds, default procedures, and rule enforcement.
Under the 2000 Commodity Futures Modernization Act, an applicant that meets the principles is automatically registered 60 days after filing with the commission. Interested parties had until February 28 to comment on AE's proposed registration, which according to the CFTC was filed February 8.
According to the application, AE Clearinghouse was organized in December under the sole management of Actuarials Exchange LLC. That entity was organized in 2000, and provided the CFTC a "notice to operate" as an exempt board of trade in January 2004.
According to its web site, Actuarials Exchange hopes shortly to begin operations with an electronic exchange, and will provide members a marketplace for interest rate and credit derivatives.
CFTC BUDGET BOOST PROPOSED FOR SECOND STRAIGHT YEAR
The proposed budget authority for the Commodity Futures Trading Commission was boosted 5.1 percent to $99 million in President Bush's fiscal 2006 budget.
This would be the second consecutive year in which the CFTC received a $5 million increase to its budget authority; for fiscal 2005, the amount increased to $94 million from $89 million, a 5.6 percent increase, in 2004.
Created 30 years ago to monitor commodities trading, the CFTC is charged with monitoring sophisticated financial transactions using derivatives.
In the proposed budget, the administration says the additional funding could be used by the CFTC to increase its ability to investigate and detect fraud and abuse, as well as to continue to ensure the integrity of the commodities markets. Also, the funds would allow the commission to increase its enforcement and surveillance activities in the growing derivatives market.
The budget proposal estimates that the CFTC will open 165 enforcement investigations in fiscal 2006, up from 160 estimated for fiscal 2005 and down from 215 in fiscal 2004. The CFTC is expected to file 65 enforcement actions in fiscal 2006, equal to the estimate for 2005 but an estimated 21.7 percent decrease from 83 enforcement actions filed during 2004.
COURT FREEZES ASSETS, RECORDS AFTER CFTC ACCUSES PARTIES OF FRAUD
The U.S. District Court for the Southern District of New York froze assets and records of several futures commission merchants and related individuals in late February after the Commodity Futures Trading Commission charged they fraudulently solicited clients to trade foreign currency futures contracts (CFTC v. Richmond Global Associates LLC, No. 05-cv-2181, 02/15/05).
The CFTC said defendants Richmond Global Associates LLC, Richmond Global Director LLC, Richmond Global MCA LLC, Richmond Global Managed Account LLC, Richmond Global Ltd., RG Group Holdings LLC, Vincenzo Danio, Joseph Pappalardo, Ronald Turner, and Miron Vonikur solicited at least 160 clients to invest approximately $3.5 million in order to trade foreign currency.
During the solicitation of the customers, the CFTC said the defendants made false promises of high returns, failed to disclose hidden commission charges, issued false account statements, and misrepresented the profit and risk potential in futures trading. The defendants also eventually misappropriated client assets, the commission said.
The CFTC said it was seeking permanent injunctions against the defendants, disgorgement, and civil fines.
URGENCY TO REVAMP PBGC BUILDING FROM LAWMAKERS, ADMINISTRATION, WORKERS
Senate Finance Committee members from both parties expressed hope late last week that Congress will pass an overhaul of the safety net for the nation's private pension programs this year, although they said they will scrutinize the administration's approach to tackling the job.
The issue before the committee was a White House proposal to revamp the Pension Benefit Guaranty Corporation, the federal agency that insures workers and retirees in 31,200 private plans. It posted a $23.5 billion deficit in fiscal 2004 after posting a surplus as recently as 2001.
At the hearing, Bradley Belt, the corporation's executive director, and other government officials told the panel that the PBGC's troubles are more than a function of current market conditions. He described PBGC's predicament as a "hole that will keep getting bigger" if nothing is done to change the rules for companies that maintain pension plans.
The administration plan would require companies facing financial trouble to increase contributions to existing defined-benefit pension plans and require companies to pay larger premiums to the PBGC. The notion of forcing struggling companies to kick in more drew sharp scrutiny from lawmakers. Senator Max Baucus (D-MT), the panels ranking Democrat, along with Senator Trent Lott (R-MS), questioned that idea, saying it could result in a "downward spiral for troubled employers."
Ann Combs, assistant secretary of Labor for the Employee Benefits Security Administration, said the aim was not to add financial stress for companies but to improve transparency through greater disclosure so potential pension problems can be addressed earlier. Combs' office oversees regulation of pension plans.
Last year, Congress enacted a short-term pension fix to ease the burden on troubled employers (PL 108-218), allowing them to reduce pension contributions by more than $80 billion during 2004 and 2005. It temporarily replaced the rate that employers use to determine the value of their defined-benefit pension plans with an index based on higher-paying corporate bonds. But the measure did not address the system's underlying weakness. Senator Baucus said he hopes this will be the year to address the problem for the long term. Only 20 percent of workers currently have a defined-benefit plan, which Finance Committee Chairman Charles Grassley (R-IA), called "a sad and disturbing statement in itself."
Senator Grassley echoed the administration view that companies, not taxpayers, have the chief responsibility for making the PBGC solvent in the long term. He said 80 percent of workers not covered by defined-benefit plans should not be responsible for subsidizing the benefits of those who are covered by such plans. Senator Grassley also praised the administration approach. "The predictable howling from some employers and union groups has begun," he said. "I'd say to the howlers, we're, as Ross Perot used to say, 'all ears.' But, what we don't want to hear is complaints only. If you don't like the administration's tough medicine, what's your solution?"
SECRETARY SNOW PLEDGES TO HELP ON MONEY LAUNDERING
Treasury Secretary John Snow has asked three senior Treasury officials to help ensure more consistent anti-money laundering enforcement and compliance standards, saying they will work with federal bank regulators and the Justice Department "to ensure that the examination and enforcement processes under the Bank Secrecy Act are fair, consistent, and achieving the ultimate policy goals of the statute."
Snow's plan, unveiled before the Florida Bankers Association February 9, makes him the most senior official yet to address what bankers say are inconsistent expectations for anti-money laundering compliance, a top industry concern.
Secretary Snow tapped three top officials to address these concerns - Assistant Treasury Secretary Juan Zarate, Treasury Under Secretary Stuart Levey, and FinCEN Director William Fox. Secretary Snow also promised help on how banks manage their relationships with money service businesses.
He said Fox will convene a meeting in Washington, DC, "to help develop specific regulatory guidance that will assist your institutions in understanding this industry, its operations, the risks posed and the obligations your industry has relating to this industry under the Bank Secrecy Act. Money service businesses - such as currency exchange firms, check-cashing companies, and others - often are seen as high-risk customers because of their potential to be used as conduits for money laundering. As a result, some bankers have refused to provide account services to money service businesses (MSB's), and in some cases have terminated their relationships with those firms.
Secretary Snow's promised guidance is designed to ease that problem. "These businesses are key components of a healthy financial sector and it is very important that they have access to banking services," Snow said.
FORMER CONGRESSMAN NAMED TO HECLA BOARD OF DIRECTORS
Hecla Mining Company (NYSE:HL) today announced that former U.S. Congressman George R. Nethercutt, Jr., has been named to Hecla's board of directors, effective immediately. He replaces Joe Coors, Jr., who retired from the board earlier this month.
Nethercutt was a member of the U.S. House of Representatives from 1995 to 2005, from the State of Washington. He is currently a principal with the strategic planning and consulting firm of Lundquist, Nethercutt & Griles, LLC. in Washington D.C. He also serves as a board member of the Washington Policy Center. Nethercutt was born and raised in Spokane, Washington, is married and has two children. Prior to serving in Congress, he was an attorney in Spokane.
Hecla President and Chief Executive Officer Phillips S. Baker, Jr., said he is very pleased Nethercutt has accepted the appointment. "George will bring a great deal of international, governmental and legal experience to the board. He has long been a supporter of the natural resource industries and is very familiar with the issues we face. He is known for his thoughtfulness and thoroughness and I know he will be a great addition to Hecla's board of directors."
Nethercutt said, "I am pleased and honored to be joining the Hecla board, a company with such a high-quality history in the Pacific Northwest and around the world."
Hecla Mining Company, headquartered in Coeur d'Alene, Idaho, mines and processes silver and gold in the United States, Venezuela and Mexico. A 114-year-old company, Hecla has long been well known in the mining world and financial markets as a quality silver and gold producer. Hecla's common and preferred shares are traded on the New York Stock Exchange under the symbols HL and HL-PrB.
About SUA
The Silver Users Association is a non-profit organization that was established in 1947 to represent the interests of companies that make, sell and distribute products and services in which silver is an essential component.
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