Rules for Security-Based Swap Dealers and Major Security-Based Swap Participants Proposed

October 17, 2012

The SEC proposed capital, margin, and segregation requirements for security-based swap dealers and major security-based swap participants.  The proposed rules are required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, which authorizes the SEC and other regulators to put in place a comprehensive framework for regulating the over-the-counter swaps markets.

Under the Dodd-Frank Act, the SEC must impose margin and capital requirements to help ensure the safety and soundness of security-based swap dealers and major security-based swap participants. The margin rules are required to be appropriate for the risk associated with security-based swaps that are not “cleared” by a security-based swap clearing agency. The proposed segregation rules are intended to facilitate the prompt return of customer property to customers before or during a liquidation proceeding if a security-based swap dealer fails.

Click to access the release proposing the rule.


Investment Advisers, Investment Companies, Regulatory