Comment Text:
The Honorable Timothy G. Massad, Chairman
Commodity Futures Trading Commission
Three Lafayette Centre
1155 21st Street, NW
Washington, DC 20581
202-418-5000
202-418-5521, fax
202-418-5514, TTY
E-mail: http://comments.cftc.gov/PublicComments/ReleasesWithComments.aspx
RE: “Cross-Border Application of the Registration Thresholds and External Business Conduct Standards Applicable to Swap Dealers and MSPs”, RIN 3038-AE54
Dear Chairman:
Americans for Financial Reform (“AFR”) commented on the above referenced Proposed Rule and Interpretations (the “Proposal”) by the Commodity Futures Trading Commission (the “Commission”).
AFR and other public interest groups have consistently urged the Commission to fully implement the statutory provision in Section 2(i) of the Commodity Exchange Act that instructs the Commission to apply swaps requirements to all activities that “have a direct and significant connection with activities in, or effect on, commerce of the United States”. If the Commission does not implement this provision and instead leaves loopholes which permit swaps activities directly connected with U.S. markets to be conducted free of regulatory oversight because they are conducted through nominally non-U.S. entities, then it will be a simple matter for large Wall Street swap dealers to channel their transactions through foreign subsidiaries and effectively evade regulation. This could easily lead to a restoration of the situation that existed prior to the 2008 financial crisis, where key elements of derivatives markets were transacted in the shadows and risks were not properly managed or controlled. Uncontrolled derivatives markets were a major contributor to that catastrophic global financial collapse.
Re: Full comment letter:
http://ourfinancialsecurity.org/2016/12/afr-statement-cross-border-application-registration-thresholds-external-business-conduct-standards/
Hoping that the concerns expressed in their letter will receive the attention they deserve, I remain,
Yours sincerely,
Robert E. Rutkowski
cc:
House Democratic Whip Office
2527 Faxon Court
Topeka, Kansas 66605-2086
P/F: 1 785 379-9671
E-mail: [email protected]
