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GAO-14-198R 1 (2013-11-27)

handle is hein.gao/gaobadpxt0001 and id is 1 raw text is: G A U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 B-325308 November 27, 2013 The Honorable Debbie Stabenow Chairwoman The Honorable Thad Cochran Ranking Member Committee on Agriculture, Nutrition, and Forestry United States Senate The Honorable Frank D. Lucas Chairman The Honorable Collin C. Peterson Ranking Member Committee on Agriculture House of Representatives Subject: Commodity Futures Trading Commission: Enhancing Protections Afforded Customers and Customer Funds Held by Futures Commission Merchants and Derivatives Clearing Organizations Pursuant to section 801 (a)(2)(A) of title 5, United States Code, this is our report on a major rule promulgated by the Commodity Futures Trading Commission (Commission) entitled Enhancing Protections Afforded Customers and Customer Funds Held by Futures Commission Merchants and Derivatives Clearing Organizations (RIN: 3038-AD88). We received the rule on November 1, 2013. It was published in the Federal Register as a final rule on November 14, 2013. 78 Fed. Reg. 68,506. The final rule adopts new regulations and amends existing regulations to require enhanced customer protections, risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures, and auditing and examination programs for futures commission merchants (FCMs). The regulations also address certain related issues concerning derivatives clearing organizations (DCOs) and chief compliance officers (CCOs). The final rule will afford greater assurances to market participants that: (1) customer segregated funds, secured amount funds, and cleared swaps funds are protected; (2) customers are provided with appropriate notice of the risks of futures trading and of the FCMs with which they may choose to do business; (3) FCMs are monitoring and managing risks in a robust manner; (4) the capital and liquidity of FCMs are strengthened to safeguard their continued operations; and (5) the auditing and examination programs of the Commission and the self-regulatory organizations (SROs) are monitoring the activities of FCMs in a prudent and thorough manner. Enclosed is our assessment of the Commission's compliance with the procedural steps required by section 801 (a)(1)(B)(i) through (iv) of title 5 with respect to the rule. Our review of the procedural steps taken indicates that the Commission complied with the applicable requirements. GAO-14-198R

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