# MINT BROKERS X-17A-5 (2023-03-01) — Broker-dealer annual report - Company: MINT BROKERS - Form: X-17A-5 - Filed: 2023-03-01 - Period: 2022-12-31 - Accession: 0000872651-23-000004 - CIK: 719188 - File #: 8-29616 - Type: Broker-dealer - Material weakness: No - Auditor: Ernst & Young LLP - Auditor location: New York, NY - Contact: Alexandra Luehs - Phone: 12128294950 - Email: jason.hauf@bgcpartners.com - Website: bgcpartners.com - Signed by: Jason Hauf (Chief Financial Officer) Original filing: https://www.sec.gov/Archives/edgar/data/719188/000087265123000004/MINTBS.pdf --- {0}------------------------------------------------ # **MINT®** STATEMENT OF FINA NC IAL CONDITIO N Mint Brokers December 31, 2022 With Report oflndependent Registered Public Accounting Firm {1}------------------------------------------------ #### **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** 0MB APPROVAL 0MB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burdeu hours per response: 12 # **ANNUAL REPORTS FORM X-17A-5 PART** III SEC FILE NUMBER 8-29616 # **Information Required Pursuant to Rules 17 a-5, 17 a-12, and 18a-**7 **under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING 01/01/22 AND ENDING 12/31/22 -------- -------- MMID D NY MMIDDNY **FACING PAGE** #### **A. REGISTRANT IDENTIFICATION** ## NAME OF FIRM: -=M=IN"'--'--"T---"B=R=O=K=E=R=S"'---------------------- TYPE OF REGISTRANT (check all applicable boxes): 0Broker-dealer Security-based swap dealer Major security-based swap participant □ Check here if respondent is also an OTC derivatives dealer #### ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | 55 Water Street, 10th Floor | | | | | |------------------------------------------------------------------------------------------------|------------------------------------------------------------|--------------------------------------------|----------------------------|--| | (No. and Street) | | | | | | New York | New York | | 10038 | | | (City) | (State) | | (Zip Code) | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | Jason Hauf | 646-346-6869 | | Jason.Hauf@bgcpartners.com | | | (Name) | (Area Code- Telephone Number) | | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
Ernst & Young LLP | | | | | | | (Name - if individual, state last, first, and middle name) | | | | | One Manhattan West 401 9th Avenue | New York | New York | 10001 | | | (Address) | (City) | (State) | (Zip Code) | | | 10/20/2003 | | | 42 | | | (Date of Registration with PCAOB)(if applicable) | | (PCAOB Registration Number, if applicable) | | | | | | | | | #### **FOR OFFICIAL USE ONLY** \* Claims for exemption from the requirement that the annual reports be covered by the reports of an independent public accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption. See l 7CFR 240. l 7a-5( e )(1 )(ii), if applicable. {2}------------------------------------------------ #### **AFFIRMATION** I, Jason Hauf, affirm that, to the best of my knowledge and belief, the accompanying statement of financial condition pertaining to Mint Brokers (the ''Partnership"), as of December 31, 2022, is true and correct. I further affirm that neither the Partnership nor any partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely as that of a customer. Jason Hauf Chief Financial Officer Lissette Martinez **NotarY** Public, State of **New York Reg. NO.** 01 **MA6356880 Qualified** In **Queens County My Commission Expires 04/10/2025** ![](_page_2_Picture_6.jpeg) {3}------------------------------------------------ #### **This filing\*\* contains (check all applicable boxes):** **0** Statement of Financial Condition. **0** Notes to Statement of Financial Condition. - **D** Statement of Operations. - **D** Statement of Cash Flows. **D** Statement of Changes in Partners' Capital. - **D** Statement of Changes in Subordinated Borrowings. - **D** Notes to Financial Statements. **D** Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.1 Sa-1, as applicable. **D** Computation of tangible net worth under 17 CFR 240.1 Sa-2. **D** Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. **D** Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. **D** Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3. **D** Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. **D** Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.1 Sa-4, as applicable. **D** Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.1 Sa-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17CFR 240.15c3-3 or 17 CFR 240.1 Sa-4, as applicable, if material differences exist, or a statement that no material differences exist. **D** Summary of financial data for subsidiaries not consolidated in the statement of financial condition. **0** Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. **D** Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.1 Sa-7, as applicable. **D** Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. **0** Independent public accountant's report based on an examination of the statement of financial condition. **D** Independent public accountant's report based on an examination of the financial report or financial statements under 17CFR 240.17a-5, 17 CFR 240.1 Sa-7, or 17 CFR 240.17a-12, as applicable . **D** Independent public accountant's report based on an examination of certain statements in the compliance report under 17CFR 240.17a-5 or 17 CFR 240.1 Sa-7, as applicable. **D** Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17CFR 240.18a-7, as applicable. **D** Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1 e or 17 CFR 240.17a-12,as applicable. **D** Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, ora statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). **D**Other:---------------------------------------- □ Statement of Cleared Swaps Customer Segregation Requirements and Funds in Cleared Swaps Customer Accounts Under 4D(F) of the Commodity Exchange Act. **D** Schedule of Segregation Requirements and Funds in Segregation for Customers Trading on U.S. Commodity Exchanges **D** Computation of CFTC :Minimum Net Capital Requirement. **D** Schedule of Segregation Requirements and Funds in Segregation for Customers' Dealer Options Accounts. **D** Statement of Secured Amounts and Funds Held in Separate Accounts for Foreign Futures and Foreign Options Customers Pursuant to Commission Regulation 30.7. **D** Supplementary Report of Independent Registered Public Accounting Firm on Internal Control Required by CFTC Regulation 1.16. *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240. l 7a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable.* {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) Ernst & Young LLP On e Manhattan West New York, NY 10001 Tel: +1 212 773 3000 Fax: +l 212 773 6350 ey. com #### **Report of Independent Registered Public Accounting Firm** To the Partners and Management of Mint Brokers #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Mint Brokers (the "Partnership") as of December 31, 2022 and the related notes (the "financial statement"), In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Partnership at December 31 , 2022, in conformity with U,S, generally accepted accounting principles, #### **Basis for Opinion** This financial statement is the responsibility of the Partnership's management. Our responsibility is to express an opinion on the Partnership's financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statement. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We have served as the Partnership's auditor since 2008. March 1, 2023 {5}------------------------------------------------ ## Statement of Financial Condition #### December 31, 2022 #### *(In Thousands)* | Assets | | |------------------------------------------------------------------|--------------------| | Cash and cash equivalents | \$
2,247 | | Other assets | 65 | | Total assets | \$
2,312 | | Liabilities, Subordinated Borrowings and Partners' Capital | | | Payables to related parties | \$
------
46 | | Total liabilities | 46 | | Commitments and contingencies (Note 2) | | | Subordinated borrowings | 1,000 | | Partners' capital | | | Limited partner | 1,253 | | General partner | 13 | | Total partners' capital | 1,266 | | Total liabilities, subordinated borrowings and partners' capital | \$
2,312 | *See notes to statement of financial condition* {6}------------------------------------------------ # Notes to Statement of Financial Condition # December 31, 2022 ## *(In Thousands)* ## **1. General and Summary of Significant Accounting Policies** **Description of Business** - Mint Brokers (the "Partnership" ) is a registered broker-dealer with the Securities and Exchange Commission ("SEC") and Financial Industry Regulatory Authority ("FINRA"), a futures commissions merchant ("FCM") registered with the Commodity Futures Trading Commission ("CFTC") and member of the Securities Investor Protection Corporation ("SIPC"). The Partnership is a general partnership organized under the laws of the State of New York, with operations solely in the State of New York. The Partnership is owned by Mint Brokers Holdings I, LLC, the Limited Partner (99%) and Mint Brokers Holdings II, LLC, the General Partner ( 1 % ), both of which are indirectly owned by BGC Partners, Inc. ( collectively with its subsidiaries, "BGC"), which is a subsidiary of Cantor Fitzgerald, L.P. ( collectively with its affiliates "Cantor"). The Partnership transacts in fixed income securities on a matched principal basis. As a registered FCM, it acts solely as a guarantor to its foreign and domestic affiliates that are registered as introducing brokers for swaps products. **Basis of Presentation** - The statement of financial condition is prepared in accordance with accounting principles generally accepted in the United States of America. **Use of Estimates** - Management makes estimates and assumptions that affect the reported amounts of the assets and liabilities and the disclosure of contingent assets and liabilities. Management believes that the estimates utilized in preparing the statement of financial condition are reasonable. Estimates, by their nature, are based on judgment and available information. As such, actual results could differ materially from the estimates included in the statement of financial condition. **Revenue Recognition** - The Partnership derives its revenues primarily through fees from related parties and interest income. *Fees from Related Parties* - Fees from related parties consist of commissions for introducing customers to an affiliate. The Partnership earns a fee on each trade executed for a customer introduced to the affiliate by the Partnership. Revenue is recognized at a point in time on the trade date. Net cash settlements between affiliates are generally performed on a monthly basis. *Interest Income* - The Partnership receives interest on cash held on deposit. **Cash and Cash Equivalents** - The Partnership considers all highly liquid investments with maturity dates of 90 days or less at the date of acquisition to be cash equivalents. {7}------------------------------------------------ ## Notes to Statement of Financial Condition *(continued)* # December 31, 2022 ## *(In Thousands)* ## **1. General and Summary of Significant Accounting Policies** *(continued)* **Income Taxes** - The Partnership is treated as a disregarded entity for U.S. tax purposes, as it is ultimately controlled by BGC Partners, L.P. ("BGCP"), which is owned directly by BGC. BGCP is an operating partnership, which is owned jointly by BGC and an affiliate ofBGC and holds the U.S. Businesses of BGC. BGCP is taxed as a U.S. partnership, files federal, state and local partnership returns and is subject to the Unincorporated Business Tax ("UBT") in New York City and Pass-Through Entity ("PE") Tax in Connecticut. The income or loss attributable to the Partnership 's operation is passed through to BGCP for tax purposes. The Partnership has not elected to push down and allocate current and deferred tax expense from BGCP and, therefore, no provision for income tax is required to be disclosed in the Partnership's financial statements, in accordance with the requirements in Accounting Standards Codification ("ASC") 740, *Income Taxes.* ## **2. Commitments and Contingencies** **Legal Matters** - In the ordinary course of business, various legal actions are brought and may be pending against the Partnership. The Partnership is also involved, from time to time, in other reviews, investigations and proceedings by governmental and self-regulatory agencies (both formal and informal) regarding the Partnership's business. Any of such actions may result in judgments, settlements, fines, penalties, injunctions or other relief. As of December 31, 2022, no such claims or actions have been brought against the Partnership and therefore no reserves were recognized. Legal reserves are established in accordance with the guidance in ASC 450, *Contingencies,* when a material legal liability is both probable and reasonably estimable. Once established, legal reserves are adjusted when additional information becomes available or when an event occurs requiring a change. **Risk and Uncertainties** - Revenues for the Partnership are primarily transaction based. As a result, the Partnership's revenues could vary based on the transaction volume of global financial markets. Additionally, the Partnership's financing is sensitive to interest rate fluctuations which could have an impact on the Partnership's overall profitability. ## **3. Related Party Transactions** CFLP and BGC provide the Partnership with administrative services, clearing and settlement services, and other support for which they charge the Partnership based on the cost of providing such services. Such support includes allocations for utilization of fixed assets, accounting, treasury, operations, human resources, legal and technology services. The Partnership had {8}------------------------------------------------ # Notes to Statement of Financial Condition *(continued)* # December 31, 2022 ## *(In Thousands)* ## **3. Related Party Transactions** *(continued)* uncollected balances included in Payables to related parties in the Partnership's statement of financial condition. As of December 31, 2022, the Partnership had clearing agreements with a Cantor affiliated broker dealer of which \$11 of settlement proceeds were held by the affiliate clearing broker included in Other assets in the Partnership's statement of financial condition. The Partnership has a subordinated borrowing with an affiliate. See Note 7 - Subordinated Borrowings for further detail related to this transaction. ## **4. Regulatory Requirements** As a registered broker-dealer, the Partnership is subject to the SEC's Uniform Net Capital Rule ("Rule 15c3-1 "). The Partnership has elected to compute its net capital using the basic method, which requires that minimum net capital, be the greater of \$250 or 6 2/3% of aggregate indebtedness. As a registered FCM, the Partnership is subject to Regulation 1.17 of the CFTC, which requires the Partnership to maintain minimum adjusted net capital equal to the greater of 8% of the customer and non-customer risk maintenance margin requirement or \$1,000. As such, the CFTC's adjusted net capital is greater than the Rule 15c3-1 's basic method minimum net capital requirement. At December 31, 2022, the Partnership had net capital of \$2,175, which was \$1,175 in excess of its required net capital. The Partnership is also required in accordance with SEC Rule 17a-5(d)(2)(i) and CFTC 1.10( d)(2)(ii) to disclose any changes in liabilities subordinated to claims of general creditors. The Partnership had \$1,000 in subordinated borrowings as of the year ended December 31, 2022. ## **5. Revenues from Contracts with Customers** See Note 1 - General and Summary of Significant Accounting Policies for detailed information on the recognition of the Partnership's revenue from contracts with customers. **Contract Balances** - The timing of the Partnership's revenue recognition may differ from the timing of payment by its customers. The Partnership records a receivable when revenue is recognized prior to payment and the Partnership has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Partnership records deferred revenue until the performance obligations are satisfied. The Partnership had receivables related to revenue from contracts with customers for the years ended December 31, 2022 and 2021. The Partnership had no impairments related to these receivables during the year ended December 31, 2022. {9}------------------------------------------------ ## Notes to Statement of Financial Condition (continued) # December 31, 2022 *(In Thousands)* ## **5. Revenues from Contracts with Customers** *(continued)* The Partnership's deferred revenue primarily relates to customers paying in advance or billed in advance where the performance obligation has not yet been satisfied. Deferred revenue is recorded as a contract liability. There was no deferred revenue as of December 31, 2022. ## **6. Off-Balance Sheet Risk** ## *Guarantees* The Partnership has entered into non-financial guarantees on behalf of BGC. As a registered FCM, it acts as a guarantor to its foreign and domestic affiliates for the introduction of commodity, option, foreign futures and foreign options products. The Partnership's liability under these arrangements is not quantifiable. However, the potential for the Partnership to be required to make payment under these arrangements is remote. Accordingly, no liability was required to be recorded in the Paitnership's statement of financial condition. ## *Credit Risk* Credit risk arises from potential non-perf01mance by counterparties. The Partnership has established policies and procedures to manage the exposure to credit risk. The Partnership maintains a credit approval process to limit exposure to counterparty risk and employs monitoring to control the counterparty risk for the matched principal businesses. The Partnership's account opening and counterparty approval process includes verification of key customer identification, anti-money laundering verification checks and a credit review of financial and operating data. The credit review process includes establishing an internal rating and any other information deemed necessary to make an informed credit decision, which may include financials, correspondence, due diligence calls and a visit to the entity's premises, as necessary. ## *Principal Transaction Risk* The Partnership executes matched principal transactions in which it acts as a "middleman" by serving as counterparty to both a buyer and a seller in matching back-to-back trades. These transactions are then settled through a recognized settlement system or third-party clearing organization. Settlement typically occurs within one to three business days after the trade date. Cash settlement of the transaction occurs upon receipt or delivery of the underlying instrument that was traded. {10}------------------------------------------------ ## Notes to Statement of Financial Condition (continued) ## December 31, 2022 #### *(In Thousands)* #### **6. Off-Balance Sheet Risk** *(continued)* The Partnership generally avoids settlement of principal transactions on a free-of-payment basis or by physical delivery of the underlying instrument. However, free-of-payment transactions may occur on a very limited basis. ## *Market Risk* Market risk refers to the risk that a change in the level of one or more market prices, rates, indices or other factors will result **in** losses for a specified position. The Partnership may allow certain of its desks to enter into unmatched principal transactions in the ordinary course of business and hold long and short inventory positions. These transactions are primarily for the purpose of facilitating clients' execution needs, adding liquidity to a market or attracting additional order flow. As a result, the Partnership may have market risk exposure on these transactions. The Partnership's exposure varies based on the size of its overall positions, the risk characteristics of the instruments held and the amount of time the positions are held before they are disposed of. All positions held longer than intra-day are marked-to-market. The Partnership's attempts to mitigate its market risk on these positions by risk limits, holding periods and hedging. However, there is no assurance that these procedures and limits will be effective at limiting unanticipated losses in the future. Adverse movements in the securities positions or a downturn or disruption in the markets for these positions could result in a substantial loss. In addition, principal gains and losses resulting from these positions could on occasion have a dispropo1tionate effect, positive or negative, on the Partnership's financial condition and results of operations for any particular reporting period. ## *Operational Risk* In providing its array of products and services, the Partnership may be exposed to operational risk. Operational risk may result from, but is not limited to, errors related to transaction processing, breaches of internal control systems and compliance requirements, fraud by employees or persons outside the Partnership or business interruption due to systems failures or other events. Operational risk may also include breaches of the Partnership's technology and information systems resulting from unauthorized access to confidential information or from internal or external threats, such as cyber attacks. Operational risk also includes potential legal or regulatory actions that could arise as a result of noncompliance with applicable laws and/or regulatory requirements. In the case of an operational event, the Partnership could suffer a financial loss as well as reputational damage. ## *Conflict in Ukraine* Management has evaluated the impact of the military conflict **in** Ukraine on the industry and concluded that, while it is reasonably possible that the conflict could have an effect on the Partnership's financial condition and results of its operations, the specific impacts are not readily determinable as of the date of this statement of financial condition. The statement of financial {11}------------------------------------------------ ## Notes to Statement of Financial Condition (continued) # December 31, 2022 *(In Thousands)* #### **6. Off-Balance Sheet Risk** *(continued)* condition does not include any adjustments that might result from the outcome of these uncertainties. #### 7. **Subordinated Borrowings** The Partnership has a subordinated borrowing from BGCP of \$1,000 as of December 31, 2022. The agreement provides for borrowings of up to \$5,000. The rate of interest on the borrowing is 7.8%. The scheduled maturity date on the borrowing is October 30, 2024. This borrowing is subordinated to the claims of general creditors, approved by FINRA and other regulators, and is included in the Partnership's calculation of net capital and the capital requirements under FINRA Rule 4120. #### **8. Subsequent Events** The Partnership has evaluated subsequent events through the date the statement of financial condition was issued. There have been no material subsequent events that would require recognition in the statement of financial condition or disclosure in the notes to the statement of financial condition. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.