Financial Regulatory Forum

Barclays may have “early bird discount” in Libor cases

By Stuart Gittleman

NEW YORK/LONDON, June 28 (Thomson Reuters Accelus) - The $453 million settlement Wednesday between Barclays and UK and U.S. officials over the manipulation of a global interest-rate setting formula may be the first in a series of big-money settlements, and those who strike a deal later may face steeper terms.

“I think additional settlements with the other [banks potentially involved in the conduct] are likely,” said Peter Henning, a former U.S. federal prosecutor and enforcement lawyer with the Securities and Exchange Commission who teaches law at Wayne State University in Detroit. (more…)

Energy companies moving forward with CFTC compliance despite uncertainties

By Thomas A. Utzinger (U.S.)

NEW YORK, May 31 (Business Law Currents) – Electric utilities and natural gas companies are facing new regulatory uncertainties involving the jurisdictional reaches of two agencies overseeing futures and derivatives trading as well as wholesale energy transactions: the U.S. Commodity Futures Trading Commission (CFTC) and the Federal Energy Regulatory Commission (FERC). Recent rulemaking efforts and litigation have raised questions as to the overlap and division of powers of these two entities over certain financial transactions and enforcement actions of interest to the energy industry. (more…)

Offshore U.S. oversight of derivatives may bolster defenses against JPMorgan-type losses

By Nick Paraskeva

NEW YORK, May 29 (Thomson Reuters Accelus) – U.S. regulators are looking to use new their oversight authority over foreign derivatives trades to reduce the chances of new shocks such as JPMorgan Chase & Co’s trading loss of at least $2 billion.

Pointing out that JPMorgan’s money-losing trades on a credit default swap index were conducted in a London unit, similar to recent failures at AIG and Lehman Brothers, Commodity Futures Trading Commission Chairman Gary Gensler said implementation of Dodd-Frank regulatory reform rules would improve supervision of such activity in the future by expanding cross-border oversight. (more…)

Client funds, net capital among hot topics for SEC 2012 exam program

By Nick Paraskeva, Thomson Reuters Accelus contributing author

NEW YORK, May 18 (Thomson Reuters Accelus) –  The SEC has new priorities in its 2012 exam program, including verifying firms’ holding of client funds and their net capital calculations.

The changes follow the collapse of MF Global, which revealed that client funds were missing despite regulations requiring that they be segregated. The revisions also reflect top findings found during the 2011 exam program, and follow major reforms to the SEC’s exam office. (more…)

Evidence, access aid job security when compliance staff raise a red flag

By Emmanuel Olaoye

NEW YORK, Feb. 9 (Thomson Reuters Accelus) - Two vivid reminders of the job-security perils faced by compliance officers and others who sound alarms at company practices were provided last week by a congressional hearing into the MF Global bankruptcy and a federal appeals court ruling on whistleblower law.

The risks may be part of the job, but skillful management of internal policies and wise self-protection can help avoid career-threatening retaliation, experts said. (more…)

Global regulation 2011: a review of policies that shaped the business world

Jan. 10 (Business Law Currents) — Global regulators have been anything but idle in 2011. Predictably, the U.S. regulatory landscape was dominated by the 800-lb. statutory gorilla, the Dodd-Frank Act. Canada busied itself trying to accommodate Basel III’s coming capital requirements. Anti-bribery regulation managed to elbow its way into UK headlines in spite of a phone hacking scandal and a royal wedding. China cracked down on loopholes for variable interest entities, while Australia’s new tax regime found few friends in the mining sector down under. (more…)

Regulatory round-up — U.S. rules to know in 2012

By Nick Paraskeva

NEW YORK, Dec. 16 (Thomson Reuters Accelus) – Several recently adopted rules in the U.S. are going into effect for specific types of firms in 2012. These rules include ones released by the Securities and Exchange Commission, Commodity Futures Trading Commission and Federal Reserve, issued to implement the Dodd-Frank Act and as a response to market developments.

The SEC-adopted rules requiring reporting by advisers to hedge funds and by large traders of securities are explained below. We also cover the CFTC final rules on derivative clearing firms in the swaps market and provide a summary of the Fed’s final rules on living wills for large banks, and non-bank systemically important financial institutions (SIFIs), under the Dodd-Frank Act. (more…)

Cost-benefit lawsuits snarl Dodd-Frank implementation

By Nick Paraskeva

NEW YORK/WASHINGTON, (Thomson Reuters Accelus) – A financial industry lawsuit seeking to block new U.S. rules on commodity position limits on the grounds that they lack an adequate cost-benefit analysis could cause regulators to slow their implementation of the Dodd-Frank financial regulatory overhaul and be an indicator of more such challenges. Meanwhile, the Obama administration is saying it will resist efforts to block the law.  (more…)

Fast-moving MF Global case offers early lessons for compliance

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, which collapsed over risky trades on European debt, faces a shortfall of $633 million in customer funds, the CME Group Inc. has estimated. (more…)

COLUMN-Two paths to failure on Dodd-Frank

capitol bldg 2 RTXX2LO_Comp.jpg(Scott McCleskey is a managing editor for the ThomsonReuters Governance, Risk and Compliance unit. The views expressed are his own)

By Scott McCleskey

NEW YORK, Feb. 14 (Complinet) – With all the chest-thumping about U.S. financial reform last year, you would suppose that the regulatory authorities responsible for implementing the provisions of the Dodd-Frank Act would now have the political wind at their back.

This is particularly the case given the tight deadline for most of the provisions — on or before the July 21 anniversary of the Act’s enactment. You would be wrong. Both sides of the aisle in Congress have taken or threatened steps which only serve to undermine the process of regulatory reform and leave the market with all the costs and none of the benefits of reform. (more…)

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