This year marks the thirteenth anniversary of the 2008 financial crisis and the 11^th anniversary of the Dodd Frank Act.[1] Title VII of Dodd-Frank, which established a new regulatory framework for swaps and security-based swaps, and was among the Act’s most significant reforms.[2]

Today, with a new generation of Wall Street bankers who were in high-school or college at the time of the crisis, the Commission has finally completed most of those reforms. The proposed antifraud and anti-manipulation rules comprise a critical component of the overall rule package. That’s because it is vital to have antifraud rules that are tailored to the specific structure and trading patterns of the security-based swap market. Thus, the Commission is re-proposing an antifraud rule that would prohibit specific misconduct in connection with security-based swaps, accounting for their unique characteristics by, among other things, explicitly addressing misconduct involving the ongoing payments and deliveries occurring during the life of a security-based swap. The re-proposed rule reflects the Commission’s experience with the security-based swap market as well as more recent market developments such as the proliferation of manufactured credit events and other opportunistic credit default swap strategies.

Today’s proposal also includes a rule aimed at protecting the independence and objectivity of security-based swap entities’ chief compliance officers (CCOs) by prohibiting actions to coerce, manipulate, mislead, or otherwise interfere with them. CCOs play a very important role in preventing fraud and manipulation, and today’s proposal is designed to help promote their independence and effectiveness by targeting undue influence and encouraging forthright communication.

Finally, today’s proposal would include proposed new rule 10B-1 generally requiring any person with a security-based swap position that exceeds a certain threshold to file with the Commission a schedule disclosing certain information related to its security-based swap position, its position in any security or loan underlying the security-based swap, and its position in other instruments related thereto.[3] This increased transparency could benefit both regulators and market participants, including promoting enhanced risk management by security-based swap counterparties.[4]

I’m pleased to support today’s proposal which is thoughtfully tailored to address the specific fraud risks in this complex market, and, importantly, to facilitate enhanced transparency and oversight for the protection of investors. I want to thank the staff for their diligent and thoughtful work on these proposed rules, and I look forward to reviewing comments.