Although the Dodd-Frank Act was signed into law nearly a year ago, and the framework of the legislation settled, the US regulators have yet to determine exactly how it will be carried out.
Today marks the close of the public comment period at the Commodity Futures Trading Commission, which oversees most aspects of the regulation involving OTC derivatives, on the acts proposed rulemakings. Central clearing of OTC derivatives in particular has been hotly debated, with market participants for and against it fiercely defending their views.
Global Custodian spoke to Frank Iacono, partner at Riverside Risk Advisors, about Title VII of Dodd-Frank, the tenet that affects OTC derivatives, and what central clearingand the legislation overallwill mean for institutional investors and their service providers. I actually question all of the promised benefits of the act, Iacono says. In my view, there isnt enough attention being paid to the unintended consequences, or potential unintended consequences, of the rules.
Click here to see the full video interview.