May 16, 2024
Dear SEC, I am writing to express genuine concern over the proposed rule change SR-OCC-2024-001 in regards to allowing market participants to change their margin requirements how it best suits them during periods of uncertainty. I support the SEC’s grounds for disapproval and feel this proposed rule change will be counter to the goal of a fair, orderly, and efficient market. The purpose of setting margin requirements for Clearing Members is to ensure that they maintain appropriate capital reserve to guarantee their trades, and allowing them to modify their margin requirements during periods of turmoil is not only unfair, but dangerous and it increases the risk of their inability to make good on their trades. Basically, a systemic risk exists because Clearing Members as a whole are insufficiently capitalized and/or over-leveraged such that a single Clearing Member failure (e.g., from insufficiently managing risks arising from high volatility) could cause a cascade of Clearing Member failures. In layman’s terms, a Clearing Member who made bad bets on Wall St could trigger a systemic financial crisis because Clearing Members as a whole are all risking more than they can afford to lose. I strongly support the SEC’s position that this proposed rule change represents a systemic risk to our existing markets and that the proposed rule should be struck down. Thank you Kasim Hussain University of Maryland Carey Law Juris Doctor