Financial services: Regulation tomorrow

Tracks financial services regulatory developments and provides insight and commentary

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On October 16, 2018, Commissioner Brian Quintenz of the Commodity Futures Trading Commission (“CFTC”) shared his views on smart contract regulation by the CFTC. In his speech at the 38th Annual GITEX Technology Week Conference, in discussing a hypothetical where code in a smart contract was specifically designed to enable a type of activity regulated by the CFTC, and no effort was made to preclude its availability to U.S. persons, Quintenz, suggested that the CFTC…
An interesting issue arose recently when a defendant was arrested on federal charges of stealing $342,000 worth of digital assets, and tried to post bond using cryptocurrency. Sue Ross has written a post for our Brand Protection Blog that includes a discussion of the case and whether the FBI permitted the defendant to post bail using that method of payment.  …
On 19 October 2018, the Regulation on the Supervision of Trust Offices 2018 (Regeling toezicht trustkantoren 2018, the Proposed Regulation) was published for public consultation. The Proposed Regulation contains: exemptions from the licence obligation under the Act on the Supervision of Trust Offices 2018 (Wet toezicht trustkantoren 2018); and an overview of the information and data that needs to be submitted as part of: a licence application for a trust office; and the reporting of…
On 10 October 2018, the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten, AFM) published the following forms in relation to the Money Market Funds Regulation (MMFR) in its Digital Portal: an application form to be used by managers of alternative investment funds (AIFs) and undertakings for collective investment in transferable securities (UCITS) to extend their existing licence so that they may also be permitted to manage Money Market Funds (geldmarktfondsen, MMFs); and a…
On 18 October 2018, a draft version of the Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018, as laid before Parliament, were published on the legislation.gov.uk website. A draft explanatory memorandum has also been published. Our previous blog on the draft statutory instrument can be found here.…
On 17 October 2018, the PRA published a Dear Chair of the Remuneration Committee letter. In advance of the annual review of firms’ remuneration policies and practices, the PRA is updating the way in which it supervises compliance within the requirements of the Remuneration Part of the PRA Rulebook. The update affects remuneration proportionality Level One (total assets exceeding £50 billion) firms only. With effect from the 2018/19 remuneration review, the PRA will no…
On 18 October 2018, the Basel Committee on Banking Supervision (Basel Committee) issued a statement on ‘leverage ratio window-dressing behaviour’. This is a form of temporary reductions of transaction volumes in key financial markets around reference dates resulting in the reporting and public disclosure of elevated leverage ratios. The Basel Committee states that window dressing by banks is unacceptable as it undermines the intended policy objective s of the leverage ratio requirement and risks disrupting…
On 18 October 2018, the Basel Committee on Banking Supervision (Basel Committee) issued a consultative document seeking views on whether a targeted and limited revision of the leverage ratio’s treatment of client cleared derivatives may be warranted. The leverage ratio complements the risk-based capital requirements by providing a safeguard against levels of leverage and by mitigating gaming and model risk across both internal models and standardised risk measurement approaches. By design, the leverage ratio does…
In a judgment recently published by the High Court (available here), a claimant has been granted the right to inspect suspicious activity reports (SARs) filed by his bank. The Court made the order in interlocutory proceedings brought in the course of an individual’s claim against his bank for breach of contract, breach of the Data Protection Act 1998 and defamation. The claim arose after the bank froze the individual’s accounts and filed SARs. The…