Financial Regulatory Forum

Fast-moving MF Global case offers early lessons for compliance

By Guest Contributor
November 4, 2011

By Emmanuel Olaoye

NEW YORK (Thomson Reuters Accelus) – Charges that hundreds of millions of dollars are missing from the accounts of MF Global’s clients raise the question of whether powerful executives at the firm influenced the independence of internal auditors as the futures brokerage scrambled for survival.

MF Global bankruptcy shows regulatory resolve

By Guest Contributor
November 1, 2011

By Nick Paraskeva

Nov. 1 (Thomson Reuters Accelus) - The collapse of MF Global Holdings is the first major U.S. financial bankruptcy since new Dodd-Frank insolvency laws ended the doctrine of “too big to fail,” as well as being the first U.S. failure attributable to the Euro crisis. While the collapse is expected to be handled under pre-Dodd Frank bankruptcy laws and under the Securities Investor Protection Corp., it may signal that regulators are prepared to take earlier action when they see uncovered financial risks.

Mitigating “Margin Call” risks

By Max Rudolph
October 26, 2011

By Dave Ingram and Max Rudolph
The opinions expressed are their own.

The financial thriller, “Margin Call,” which opened in movie theaters on Friday, tells the story of a firm in the mold of a Bear Stearns or Lehman Brothers at the height of the financial crisis. The firm in the film is akin to real-life firms that seemingly discover too late their reliance on a culture built on growth at any cost and tainted models at the expense of risk management.

Banking on Volcker: Big Crisis, Big Rule

By Guest Contributor
October 19, 2011

By Thomson Reuters Accelus staff

NEW YORK, Oct. 19 (Business Law Currents) – Banking lawyers should be forgiven if they’re not returning calls right away: they’re busy trying to digest the Volcker Rule (or “the rule”). The proposed rule’s 298-page doorstop represents the collective efforts of the Treasury Department, Fed, FDIC and SEC to implement §619 of the Dodd-Frank Act, which itself added a new §13 to the Bank Holding Company Act of 1956 (the BHC Act). The intent of the Volcker Rule is to “generally prohibit any banking entity from engaging in proprietary trading or from acquiring or retaining an ownership interest in, sponsoring, or having certain relationships with a hedge fund or private equity fund (“covered fund”), subject to certain exemptions.”

Exchange traded funds’ growth raises multiple regulatory issues

By Guest Contributor
October 19, 2011

By  Patrick Conroy, James Overdahl, Robert Patton and Raymund Wong; NERA Consulting, Thomson Reuters Accelus contributing authors. The views expressed are their own.

U.S. credit market remains uneasy in the world of representations and warranties

By Guest Contributor
October 12, 2011

US dollar note and other currenciesBy Alex Lee

NEW YORK, Oct. 12 (Business Law Currents) - The first half of 2011 saw rebounding credit markets and an uptick in debt issuance. Due to uncertain economic conditions in the second half of 2011, however, even the most fundamental aspects of loan documentation are facing increasing scrutiny. Representations & warranties that were more routine and non-contentious transformed into significantly stricter provisions as a result of the credit crisis.

COLUMN – Rogue traders, delta trading and exchange-traded funds

By Guest Contributor
October 7, 2011

By Helen Parry, the views expressed are her own.

LONDON, Oct. 7 (Thomson Reuters Accelus) - There are many common features in cases of rogue or unauthorised trading, including the use by ostensibly riskless arbitrage traders of fictitious trades on internal systems to mask their unhedged positions. One obvious feature that is present in many rogue trader cases has been a failure in trade confirmation systems and controls. This feature frequently appears conterminously with the fact that a trader has intimate knowledge of and/or power and influence over middle and back office systems. (more…)

Role of hedge-fund boards gains importance in face of compliance, legal pressures

By Guest Contributor
October 7, 2011

By Judith Gross, Contributing Author. The views expressed are her own.

NEW YORK, Oct. 7 (Thomson Reuters Accelus) - The role of directors on offshore hedge funds has often been, at best, a limited oversight one, with perfunctory meetings and a limited interchange with the fund itself during the year. That has been changing – slowly – as compliance moves to the top of the list of concerns for investors and managers alike. In addition, directors themselves are realizing that the status quo is no longer tenable.

U.S. SEC warns brokers over market access, sub-accounts in debut “risk alert”

By Guest Contributor
September 30, 2011


By Stuart Gittleman and Brett Wolf

NEW YORK, Sept. 30 (Thomson Reuters Accelus) – The U.S. Securities and Exchange Commission (SEC) issued an unexpected warning to broker-dealers to supervise trading by customers with direct market access, especially customers that trade using master- and sub-accounts.

from Christopher Whalen:

The cure for higher ATM fees is competition

September 30, 2011

Why are Bank of America and other large US banks increasing fees for the use of debit cards and other services?