BNA INSIGHTS: Collateral Damage: FATCA Implications For OTC Derivatives Supported by U.S. Dollar Assets

This article focuses on the FATCA implications of one seemingly small compliance issue—withholding on collateral arrangements. As our readers know, however, even a small falter can unseat riders…

ANALYSIS: The Evolution of Credit Default Swaps and Efforts to Regulate Them: What Will Be the Impact of JP Morgan Chase’s Recent $2 Billion Trading Loss?

“Every swap transaction is unique, like a snowflake, and you can’t make snowflakes with a cookie cutter like the Commodity Exchange Act […] While many believe that the CFTC’s actions may cause a financial crisis, no one believes that CFTC action is needed to solve one.” A representative of J.P. Morgan Securities, Inc. made this statement in 1998 when Congress assessed the CFTC’s first efforts to regulate the over-the-counter (OTC) derivatives markets. 1 Derivatives, including credit default swaps (CDS)—the instrument that caused JPMorgan Chase’s recent $2 billion (and mounting 2 ) trading loss—remained unfamiliar to the general public and unregulated for the decade that followed.

CFTC Issues Proposals on Guidance, Phase-in Plan for Cross-Border Swap Entities

The Commodity Futures Trading Commission June 29 voted unanimously to propose interpretive guidance regarding how its rules for over-the-counter derivatives would apply to non-U.S. entities and activities outside the United States.

CFTC Launches Investigation into J.P. Morgan Derivatives Loss

The Commodity Futures Trading Commission has opened an investigation into “credit derivatives products as traded by the chief investment officer” of J.P. Morgan, (JPM) agency chairman Gary Gensler told reporters May 21.

CFTC Proposes That Foreign Regulators Need Not Indemnify Swap Data Repositories Under Dodd-Frank Act

The Commodity Futures Trading Commission voted 5-0 May 1 to propose an interpretative statement that in many cases would exempt foreign regulators from having to indemnify swap data repositories when seeking information from the entities, as required in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.

SEC, CFTC Adopt Long-Awaited Definitions for Swap Dealer, Major Swap Participant

In a long-awaited vote, the Securities and Exchange Commission April 18 unanimously adopted final definitions for security-based “swap dealers” and “major swap participants”—entities that will be subject to registration, capital, margin, and business conduct requirements in the new regime.

ANALYSIS: New U.S. Registration Requirement For Foreign Boards Of Trade

The CFTC recently promulgated rules requiring the registration of FBOTs that provide U.S. members and participants with direct access to the FBOTs’ electronic trading and order matching systems…

Industry Experts Fear Big Banks Will Withdraw if U.S. Swaps Rules Too Strict

Several financial industry experts said Sept. 22 that one of their key fears as regulators implement the Dodd-Frank Wall Street Reform and Consumer Protection Act is that bigger industry participants with the means to do so will decide to conduct business in jurisdictions outside the United States with friendlier regulatory environments…

SEC Agrees to Issue Concept Release to Seek Views on Funds’ Use of Derivatives

The Securities and Exchange Commission Aug. 31 voted unanimously to issue a concept release soliciting public comments on issues raised by mutual funds, exchange-traded funds, and other investment companies’ use of derivatives…

Non-U.S. Financial Firms May Be Subject to Dodd-Frank Swaps Provisions, Lawyers Say

Non-U.S. financial institutions are concerned that pending derivatives regulation may chill their interest in market participation, at least until the way the law is going to be enforced is clarified…

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