The Commodity Futures Trading Commission voted 5-0 today to limit how brokers invest clientsâ margin in money market funds, and ban investments in foreign sovereign debt and in-house transactions such as repurchase agreements. It is not clear whether the rule would have prevented MF Global from misappropriating as much as $1.2 billion in customer money, in what regulators believe was an unprecedented breach of client funds. Many firms, including MF Global and its former chief executive, Jon Corzine, lobbied against the rule and asked the CFTC to hold back on finalizing it. http://www.bloomberg.com/news/2011-...protection-rule-after-mf-global-collapse.html http://www.reuters.com/article/2011/12/05/us-financial-cftc-meeting-idUSTRE7B410420111205 I would like to know who are the "many firms" that lobbied against this rule...
Brokers should have ZERO ability to invest margin funds. WTF?? They certainly don't share the profits when they make them. As for the list of firms who lobbied against the regulation, what about the Freedom of Information Act? If they lobbied government it should be public information?
Here's a comment letter from the Futures Industry Association (FIA) from 2009 on Rule 1.25. "To prepare this comment letter, FIA formed a committee comprised of individuals responsible for financial management at a significant number of member firms. . ." http://www.cftc.gov/ucm/groups/public/@lrfederalregister/documents/frcomment/09-006c004.pdf
rules Do Not *protect* client funds, neither apparently do regulators client funds need to be insured, separately, from the broker's business currently the MF G creditor claims are leaving clients' claims a poor third in line and the possibility some US clients won't have any money returned