BROWSE BY TOPIC
- Bad Brokers
- Compliance Concepts
- Investor Protection
- Investments - Unsuitable
- Investments - Strategies
- Investments - Private
- Features/Scandals
- Companies
- Technology/Internet
- Rules & Regulations
- Crimes
- Investments
- Bad Advisors
- Boiler Rooms
- Hirings/Transitions
- Terminations/Cost Cutting
- Regulators
- Wall Street News
- General News
- Donald Trump & Co.
- Lawsuits/Arbitrations
- Regulatory Sanctions
- Big Banks
- People
TRENDING TAGS
Stories of Interest
- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
ABOUT FINANCIALISH
We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.
Stay Informed with the latest fanancialish news.
SUBSCRIBE FOR
NEWSLETTERS & ALERTS
'MF Global Rule' Approved by CFTC
December 5, 2011
The CFTC has voted unanimously to adopt tougher constraints on Wall Street risk-taking. The effort is being referred to as the “MF Global rule,” named after the collapsed brokerage firm that reportedly accessed without authorization hundreds of millions in customers' segregated funds.
As drafted, the new rule will limit how the brokerage industry can invest customer money, largely banning firms from using client funds to buy foreign sovereign debt. It also will prevent a complex transaction that allowed MF Global, in essence, to borrow money from its own customers. Firms that seek to invest customer funds in foreign government bonds will be required to first petition the CFTC for a special exemption. The new rule also would ban firms from using client money so that one arm of the company can lend to another, a complex transaction known as an in-house repurchase agreement.
The CFTC had originally planned to finalize the rule months ago, but the agency delayed the overhaul amid fierce push-back from Jon Corzine, who at the time was the chief executive of MF Global. Mr. Corzine resigned on 11/4/11, four days after MF Global filed for bankruptcy.
MF Global allegedly violated that principle in the firm’s final chaotic days, tapping its segregated client accounts to meet its own financial obligations. Investigators have since been looking for what some estimate is as much as $1.2bn in missing money. (The CFTC is leading the hunt for the money while the FBI is examining potential wrongdoing.)
This is the first in a line of many new rules regulators are considering, including numerous proposed rules for brokerage firms.
The SEC is weighing new accounting disclosures for the industry and there is renewed call for federal regulators to keep a closer watch of brokerage firms, reclaiming oversight authority now delegated to for-profit exchanges like the CME Group.
For more info, go to [Dealbook 12/5/11].

