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Formal Regulatory Remedies

Ensuring Responsible AI Adoption in Financial Services: A Four-Part Test for Evaluating Deep Learning Models

Introduction In the dynamic landscape of financial regulation, the accuracy and reliability of internal rules-based (IRB) models for regulatory capital calculations have become increasingly critical.  The Treasury’s Basel IV endgame reproposal presents a valuable...

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New Money Fund Reforms: Safer and More Resilient Cash Collateral Pools?

More liquidity, transparency, and safety for institutional investors? The Securities and Exchange Commission (SEC) recently adopted final rules on money market (2a-7) fund reforms. These reforms are designed to make money market funds more resilient and liquid, potentially making them safer and more attractive vehicles for mutual funds to use as collateral pools for their […]

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SEC Adopts Long Awaited Securities Lending Disclosure Rule

Persuasive Public Comment Helps Mold the Final Rule The Securities and Exchange Commission (SEC) has adopted a new rule, rule 10c-1, to increase transparency in the securities lending market. The rule requires certain persons to report information about securities loans to a registered national securities association (RNSA). The RNSA will then make certain information publicly […]

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The SEC Unveils its Agenda for 2023

A Busy Mix of New Business and Old In its recently updated regulatory flexibility agenda, the Securities and Exchange Commission has announced its regulatory priorities for 2023. A mix of old and new business, the Commission’s 2023 plans include finalizing 29 existing proposals and placing 23 new proposals up for consideration. In a January 4, […]

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SEC Beefs Up Proxy Voting Disclosure

Does meaningful proxy voting transparency reveal too much? On November 2, 2022, the Securities and Exchange Commission (SEC) finalized the first of its market data rule proposals. The amendments to form N-PX bring greater detail, consistency, and usability to the proxy voting information reported by mutual funds. These changes came in response to investors, who […]

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Serious Doubts About the SEC’s Short Sale Proposals

Disclosures Could be a Real Challenge for Managers and Brokers In February of 2022, the Securities and Exchange Commission proposed new disclosures to provide more transparency into institutional investors’ short-selling activity. According to Chairman Gensler, collecting more granular data from large short sellers “would help us to better oversee the markets and understand the role […]

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Bringing Crypto Asset Activities Into the Regulatory Perimeter

Tech Innovation Meets Prudential Regulation A collection of the globe’s most significant securities trade associations[1] joined forces to file a comprehensive response to the Basel Committee on Banking Supervision’s (BCBS) second public consultation on the prudential treatment of banks’ crypto-asset exposures. The September 30, 2022, letter voiced support for the design of the crypto-asset exposure […]

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Is T+1 Something We Can All Agree On?

The Industry Reacts to a Compressed Settlement Plan In moving to shorten the U.S. securities settlement cycle by one day to T+1, the Securities and Exchange Commission appears to have hit on something upon which virtually everyone can agree. Judging by the comments to the SEC’s T+1 proposal, everyone from State Street to the Cornell […]

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