The facts in the Letter are quite sparse, which makes it difficult to understand why relief was necessary. First, it is not clear from the Letter that the entity entering into swaps was an investment vehicle and, thus, why it would be considered a commodity pool as opposed to an operating company. Second, even if the entity was a fund, the Letter does not address why the vehicle could not rely on an existing registration exemption under the CFTC Rules, for example, the limited trading…

The DSIO has issued a series of virtually identical no-action Letters granting relief from the common control requirement of CFTC Letter 14-126. In the new age of regulatory efficiency, DSIO should consider issuing an interpretive letter dispensing with the common control requirement, thereby relieving firms, and the CFTC itself, from having to go through the no-action process.

The MSRB's statement provides a useful outline for firms to undertake a general review of their compliance procedures in this space. There is nothing like a priority risk list from the regulators to focus one's attention.

There are few policy decisions that are as significant for a regulatory agency as determining how to handle firms and individuals that come forward with admissions of their own legal violations. It often seems to outside observers that the desire of regulators to chalk up an easy win, or to be acclaimed for collecting a fine, overwhelms any inklings of common sense (or compassion). This is unfortunate because when a firm comes forward, particularly with information as to unintended…