10.16.2009 The SEC and the CFTC issued a joint report (Report) on harmonizing regulation as a result of the Obama Administration’s release of a White Paper on Financial Regulatory Reform (White Paper) issued on June 17, 2009. The White Paper requested the agencies to identify all existing conflicts in statutes and regulations with respect to similar types of financial instruments and to either explain why those differences are essential to achieve underlying policy objectives with respect to investor protection, market integrity, and price transparency or make recommendations for changes to statutes and regulations that would eliminate the differences.
The agencies held public joint meetings in September 2009. Thirty panelists—consisting of members of the investor community, academics, industry experts, and market participants—attended the meetings and assisted the agencies in defining the issues of greatest concern. They explored topics ranging from exchange, markets, and clearing issues to regulation of intermediaries and end-users to enforcement.
The Report focuses on a number of issues that emerged through the public deliberations as the matters most relevant to a reconciliation of the two agencies’ statutory and regulatory schemes. The Report reviews and analyzes the current statutory and regulatory structure for the CFTC and the SEC in the following areas:
- Product listing and approval;
- Exchange/clearinghouse rule changes;
- Risk-based portfolio margining and bankruptcy/insolvency regimes;
- Linked national market and common clearing versus separate markets and exchange-directed clearing;
- Price manipulation and insider trading;
- Customer protection standards applicable to financial advisers;
- Regulatory compliance by dual registrants; and
- Cross-border regulatory matters.
Click http://www.sec.gov/news/press/2009/cftcjointreport101609.pdf to access the joint report.
Click http://www.sec.gov/news/speech/2009/spch101609mls.htm to access the SEC Chairman’s remarks on the report.