(a) Fraudulent conduct prohibited. No banking institution or its related persons may, directly or
indirectly, in or in connection with any retail forex
transaction:
(1) Cheat or defraud or attempt to cheat or defraud any
person;
(2) Knowingly make or cause to be made to any person any false report or
statement or cause to be entered for any person any false record;
or
(3) Knowingly deceive or attempt to deceive any person by any means
whatsoever.
(b) Acting as counterparty and exercising discretion
prohibited. A banking institution that has authority to cause retail forex
transactions to be effected for a retail forex customer without the retail
forex customer’s specific authorization may not (and an affiliate of such an
institution may not) act as the counterparty for any retail forex transaction
with that retail forex customer.
