Alert May 03, 2011

CFTC Proposes Rules Designed to Protect Cleared Swaps Customer Contracts and Collateral

The CFTC issued a proposal that would impose segregation requirements on futures commission merchants and derivatives clearing organizations regarding the treatment of cleared swaps customer contracts and related collateral.  The proposal would also make conforming amendments to bankruptcy provisions applicable to commodity brokers under the Commodity Exchange Act.  Comments on the proposal are due within 60 days after its publication in the Federal Register.