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77 FR XXXX The CFTC is adopting regulations pertaining to the protection of cleared swap customer contracts and related collateral. Specifically, the regulations impose requirements on FCMs and DCOs) regarding the treatment of cleared swaps customer contracts (and related collateral), and make conforming amendments to bankruptcy provisions applicable to commodity brokers under the CEA. Significantly, the CFTC rules adopted a model entitled the "Legally Segregated Operationally Commingled Model" or the "Complete Legal Segregation Model" that allows the collateral of all of an FCM's cleared

CFTC Dodd-Frank Rulemaking 76 Fed. Reg. 6708 February 8, 2011 Closing Date for Comments: April 11, 2011 The proposed rule would set forth parameters for the inclusion of an orderly liquidation termination provision in the swap trading relationship documentation for swap dealers and major swap participants. The rule is being proposed pursuant to Section 731 of the Dodd-Frank Act added a new section 4s(i) to the Commodity Exchange Act, which requires the Commission to prescribe standards for swap dealers and major swap participants related to the timely and accurate confirmation, processing

Futures Industry Association FIA filed a comment letter with the CFTC on Jan 18 in response to the CFTC's advance notice of proposed rulemaking regarding the protection of customer collateral posted with futures commission merchants in connection with the clearing of swap transactions. The CFTC's notice asked for comment on several models for dealing with "fellow customer risk", including the full segregation of each customer's collateral in separate accounts. FIA noted that the "baseline" model, i.e., the existing model used in the clearing of exchange-traded futures and options, has proven