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Regulators Discuss Challenges at the 5th Annual FIA/OIC Equity Options Conference

The last panel of the 5th Annual FIA-OIC New York Equity Options Conference, which took place in early October, had many attendees sticking around for the “Ask Your Regulators” discussion in hopes of learning some new perspectives from representatives of the SEC and CFTC. Moderated by the Options Clearing Corp. (OCC), the panel addressed the challenges the two regulators face in drafting the OTC derivatives rules and gave some updates on the rulemaking process.

There are several concerns the SEC and CFTC have:

  • The need for a clear definition of a swap execution facility (SEF)
  • The lack of funding for rulemaking and industry oversight
  • The implications of the nuanced differences between the listed and OTC markets

Ananda Radhakrishnan, Director of Division of Clearing and Intermediary Oversight, CFTC, said that “the CFTC and SEC have additional responsibilities but Congress didn't give additional requested funding.”

Although the two regulatory agencies have made it clear they are facing budgetary restraints, Radhakrishnan said they “have 30 teams for the rule-making process for the Dodd-Frank Bill.” According to the CFTC, the regulator anticipates releasing proposed rules for SEFs and real time reporting sometime in November or December.

Watch the full webcast of the panel here.

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