Comment Letter Responding to CFTC’s Advanced Notice of Proposed Rulemaking on Protection of Collateral Posted by Customers Clearing Swaps

MFA submitted a comment letter to the CFTC in response to its advanced notice of proposed rulemaking on protection of collateral posted by customers clearing swaps. In our letter, MFA suggests that the CFTC should evaluate each segregation model based on the degree of protection for customer assets and the ease of portability that it provides. We strongly urge the CFTC to conduct a comparative cost study of each segregation option before adopting any particular model, and if the cost study reveals that full physical segregation would not impose inordinate costs on customers, we strongly recommend that the CFTC adopt that model.