The CFTC has passed new rules after the ‘no-holds barred’ wake-up call of MF Global.
In a carefully co-ordinated show of unity, the Commodity Futures Trading Commission passed a rule designed to protect customer funds in the event of a broker default.
Chairman Gary Gensler said: "It prohibits clearing organisations from using the collateral of non-defaulting, innocent customers to protect themselves and their clearing members. For the first time, customer money must be protected individually all the way to the clearing house."
The rule, passed 4-1, will protect the collateral of swaps traders but at the same time allows brokers to pool customer cash – a small concession to the derivatives industry lobby.
Commissioner Jill Sommers, who is leading the investigation for the CFTC, voted against the rule having made clear she believed futures clients were being disadvantaged.
The CFTC, FBI...