Comment Text:
Executive Summary
In the context of the proposed rule, we offer the Agencies this comment on defining and creating criteria for identifying market-making versus proprietary trading activity. We submit that if firms
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can understand and readily identify proprietary trading activity, then they can effectively abide by the Volcker Rule and minimize banking risk, enabling banks to become more focused in their business operations. We discuss the need to develop a litmus test, which focuses on compensation/bonus pool allocations, for firms to use in order to determine and easily ascertain whether or not they are conducting market-making or proprietary trading. We explain how this test can be applied in order to facilitate the successful implementation of the Volcker Rule.
