Regulatory Alerts2024-01-03 | 2023-28767Protection of Clearing Member Funds Held by Derivatives Clearing Organizations
The Commodity Futures Trading Commission proposes regulations to safeguard clearing member proprietary funds held by derivatives clearing organizations by requiring strict segregation from the DCO's own assets and written acknowledgment from depositories. The proposal mandates daily reconciliation of funds owed versus held and permits holding these funds at central banks in G7 money center countries under modified acknowledgment requirements. These measures aim to ensure proper treatment and availability of funds in the event of a DCO bankruptcy, extending protections comparable to those currently afforded to customers.
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