CFTC Proposes New OTC Derivatives Class

Law360, New York (August 13, 2009, 6:46 PM EDT) -- The U.S. Commodity Futures Trading Commission has proposed creating a separate account class for over-the-counter derivatives, a move it said would permit the extension of certain protections in bankruptcy proceedings.

The CFTC said Thursday that the new class would include derivatives that a futures commission merchant carries for a customer and submits for clearing through a derivatives clearing organization.

The creation of this class would allow protections to be extended during bankruptcy to the positions that customers of a futures commission merchant hold in cleared OTC...
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