SIFMA Asks for Harmonization of Securities Dealer and Security-Based Swap Dealer Rules

SIFMA recommended modifications to the SEC's internal business conduct standards for security-based swap ("SBS") dealers and major SBS participants. The recommendations are intended to harmonize the FINRA Supervision Rule, the FINRA CCO Rule and the CFTC CCO Rule.

In its letter, SIFMA stated that consistency is important because most SBS Entities have already invested significant resources to develop controls and processes, and adopt policies and procedures to comply with those rules. SIFMA argued that harmonization of the rules will allow SBS Entities to leverage existing processes and speed implementation. Harmonization of the rules will also enhance the ability of SBS Entities to identify and remediate non-compliance issues by permitting personnel to focus on the substance of issues rather than allocating resources to comply with the formalities of multiple overlapping but slightly differing rules.

Finally, SIFMA suggested that since these internal business conduct standards would apply to an SBS Entity on an entity-wide basis, it supports the SEC's proposal to permit a foreign SBS Entity to satisfy them on a substituted compliance basis by complying with comparable home-country requirements.