SEC Adopts Rule To Limit Naked Access To Markets

Law360, New York (November 3, 2010, 4:35 PM EDT) -- The U.S. Securities and Exchange Commission on Wednesday adopted a rule to limit unfiltered, or naked, access to exchange or alternative trading systems.

The rule, approved unanimously, requires brokers and dealers to put in place risk management and supervision controls before providing customers access to such markets, the SEC said in a statement.

Commissioners said they hoped the regulation would minimize erroneous orders, ensure compliance with regulatory systems, and enforce preset credit or capital thresholds.

“I have previously likened unfiltered access to giving your car keys...
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