Feb. 20, 2024
Thank you SEC for allowing the public to comment on SR-OCC-2024-001. I am deeply concerned about the transparency from the OCC. The proposal from OCC did not allow for any input from any other party. Firstly, there is extensive redaction in the proposal, which obfuscates the ability for the public to determine what truly is in the proposal and suggest meaningful changes. I'd suggest no redaction on the proposal as we are only exposed to a part of the proposed changes. As it relates to Risk Management, I believe that to preserve system stability, we need a higher degree of accountability. If a Clearing Member defaults, there may be further liquidity challenges for other non-defaulting Clearing Member. All clearing members should be subject to fulfill margin obligations even during times of market stress, otherwise there is no financial consequence to risky positions. The opposite should actually be implemented: increased margin requirements should be implemented for effective and responsible risk management. Additionally, these margin obligations should be transparent for anyone to analyze and determine the health of the overall market structure. For Idiosyncratic Control Settings, I am concerned about the number of these decisions. There have been more than 200 idiosyncratic decisions in less than 4 years. There has been a $2.6 billion decrease in aggregate margin requirements linked to idiosyncratic controls. I believe we need to implement a framework for assessing idiosyncratic controls' impact on the market. Furthermore, this framework should be a transparent process that is visible to the public. Thank you for allowing the public to comment on this proposal. Sincerely, Joseph Tam