SEC Gives Chicago Exchange CDS Swap Authority

Law360, New York (March 16, 2009, 12:00 AM ET) -- Derivative clearinghouse Chicago Mercantile Exchange has received preliminary approval from the U.S. Securities and Exchange Commission to act as a central counterparty in credit default swap clearing and trading, putting into place technological and regulatory measures it hopes will bring stability and transparency to the troubled CDS market.

The SEC announced on Friday that it has granted a special exemption to the CME and Chicago hedge fund Citadel Investment Group LLC to proceed with their request to begin operating as central counterparties in the over-the-counter CDS...
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