CFTC Demands Banks Prove Dodd-Frank Act Swaps Compliance

CFTC Demands Banks Prove Dodd-Frank Act Swaps Compliance

The U.S. Commodity Futures Trading Commission has given the world’s largest banks until May 3 to prove they are complying with a part of the Dodd-Frank Act.
The 2010 law requires swaps brokers to accept or reject a trade for clearing in less than 60 seconds. Goldman Sachs Group Inc. (GS), Bank of America Corp., Credit Suisse Group AG (CSGN), UBS AG (UBSN), Barclays Plc (BARC) and JPMorgan Chase & Co. (JPM) were among the banks that received the April 17 letter, a copy of which was given to Bloomberg News. The CFTC in November granted three-month delays to at least eight banks for implementing the time standard.
The CFTC is writing and implementing rules mandated by Dodd-Frank, which overhauled U.S. financial regulation in the wake of the 2008 credit crisis. The act gave regulators oversight of the over-the-counter swaps market for the first time, including requirements that most trades be sent to clearinghouses to reduce systemic risk. To help the market move to electronic trading, the CFTC said cleared trades must be accepted “as quickly as would be technologically practicable if fully automated systems were used.”