[By Larry Goldfarb]

In the open statement before an open meeting of U.S. Securities and Exchange Commission on Oct. 17, 2012, Mary Schapiro, the Commission's Charman, proposed new rules for swap participants. The new rules that would establish capital, margin, and segregation requirements for security-based swap dealers and major security-based swap participants. It would also enhance the capital requirements for the large broker-dealers that we have approved to use internal models in computing their net capital.

According to Schapiro, The proposals stem from Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act — the Act that authorizes the Commission and other regulators to put in place a comprehensive framework for regulating the over-the-counter swaps markets.  The goal of the proposed segregation rules is to help ensure that customer property can be promptly returned to customers from a security-based swap dealer, for example, either before or during a liquidation proceeding if a security-based swap dealer fails.

For further information, please read [SEC, 10/17/12]