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Strategic Goal Four


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Strategic Goal Four


Enhance integrity of U.S. markets by engaging in cross-border cooperation, promoting strong international regulatory standards, and encouraging ongoing convergence of laws and regulation worldwide.

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FY 2012 INVESTMENT

Net Cost: $6.9 Million

Staffing: 23 FTE

The implementation of comprehensive regulations under the Dodd-Frank Act legislation marks a new era in the swaps marketplace by mandating, among other things, the regulation of swap dealers, clearing of swaps, and transparency with respect to those transactions. However, regulation in the United States alone will not be sufficient to protect the financial system.

Because the swaps market is conducted on a global basis, it is possible for swaps executed offshore by U.S. financial institutions to transmit the risk of those transactions back to the United States. This happened with the offshore affiliates of AIG, Lehman Brothers, Citigroup, Bear Stearns, and Long Term Capital Management and most recently when JPMorgan Chase executed swaps through its London branch.

Recognizing this risk, the United States joined with other G20 leaders in 2009 to require that all major market jurisdictions bring swaps under regulation. Since that date, the Commission has been engaged in an unprecedented outreach to major market jurisdictions and expanded involvement in numerous international working groups to encourage the adoption of robust swaps regulation.

This added emphasis is in addition to the Commission's long-standing engagement with foreign regulators to establish customer and market protection arrangements in futures trading. It is also in addition to the Commission's strong role in international standard setting organizations such as IOSCO, which recently recognized the Commission's long history of contributions by voting to make the Commission a full member.

Finally, the CFTC also provides technical assistance to emerging and recently-emerged markets to help these jurisdictions in establishing and implementing laws and regulations that foster global market integrity. The Commission's international training symposium has consistently attracted wide attendance by foreign regulators who look to the Commission as a global standard setter in derivatives regulation.

Goal Four Key Results

 

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