Comment Letter to the CFTC on Governance Requirements for Derivatives Clearing Organizations, Designated Contract Markets, and Swap Execution Facilities; Additional Requirements Regarding the Mitigation of Conflicts of Interest

March 07, 2011

From: MFA, Stuart Kaswell

To:

David Stawick, CFTC
Gary Gensler, Michael Dunn, Bart Chilton, Jill Sommers, Scott O'Malia, (all) CFTC. Mary Schapiro, Kathleen Casey, Elisse Walter, Luis Aguilar, Troy Paredes, (all SEC)

MFA submitted a comment letter to the CFTC on Governance Requirements for Derivatives Clearing Organizations, Designated Contract Markets, and Swap Execution Facilities; Additional Requirements Regarding the Mitigation of Conflicts of Interest. In our letter, MFA reiterated many comments from our November 17, 2010 letter to the CFTC on Requirements for Derivatives Clearing Organizations, Designated Contract Markets, and Swap Execution Facilities Regarding the Mitigation of Conflicts of Interest. We recommended that the CFTC: (i) expressly require non-dealer, customer representation on DCO Boards, risk committees and other similar bodies; (ii) affirmatively limit the representation of enumerated entities to less than a controlling majority; (iii); allow DCO management to participate on risk committees and other similar bodies; and (iv) require DCO Boards to review and re-examine any decision made by the DCO risk committees for conflicts of interest.

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