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[...]The consequences of this paralysis was highlighted last year when the Depository Trust and Clearing Corporation, which has become the main information warehouse for data relating to the CDS market, decided to charge for up to date data (although allowing free access with a month’s delay).
The move means that anyone wishing to unearth real-time information on the amount of credit protection bought and sold on individual companies and countries must now pay the DTCC to do so. Not exactly the burst of sunlight that Dodd-Frank was supposed to bring.
“Dodd-Frank required transparency and aggressive oversight of the swaps market,” says Dennis Kelleher, chief executive of Better Markets, which advocates for financial reform. “But it’s declining from bad to worse. To talk about transparency and oversight here is almost an oxymoron.”
The rules from the CFTC and SEC would prohibit organisations such as the DTCC from charging for data that should be publicly available. A DTCC spokesperson said the data it would be required to make available for free under the SEC rule is actually different to the aggregated weekly reports it produces and charges for. Indeed, it will continue to charge for the weekly reports once the rule comes into force.
Regulators, academics, journalists and the dealers that supply the DTCC with the trade data in the first place are all able to continue receiving them for free, the spokesperson added, if they agree to a set of terms on how they are is used.
But the question isn’t about whether the DTCC’s decision to charge breaches any of the rules, it is that transparency in an important derivatives market has actually declined since Congress passed Dodd-Frank.
The SEC this week reopened the comment period for one of the rules it is yet to finish. But given the Trump administration’s laissez-faire approach to regulation, some observers anticipate that the process will be used as a tool to water down the rules before they are enacted. In a recent speech, Hester Peirce, one of the SEC’s new commissioners, said the leftover work needed on rulemaking is an “opportunity to reflect on our proposed and perhaps our already-adopted rules to identify areas where we may be able to make changes”. Make of that what you will. [...]
Full article on Financial Times (subscription required)