May 17, 2024
I am writing to express my concerns about SR-OCC-2024-001. I cannot support the approval of this proposal due to several reasons: 1. The proposal contains significant redactions, and this prevents meaningful public review and comments. 2. The proposal fails to properly manage liquidity risk and increases systemic risk, as evidenced by the OCC's reliance on reducing margin requirements. 3. The role of the Financial Risk Management Officer has an inherent conflict of interest to oversee both the well-being of Clearing Members as well as the agency itself. 4. The proposal shifts the costs of Clearing Member defaults to a non-bank liquidity facility whose constituents I would revise, because those responsible for creating risks could have unrelated parties paying their debts, and this seems inappropriate to me. There are a great multitude of lobbyists, current and former members of the U.S. Congress, current and former officers of Treasury Dept and Federal Reserve and regulatory agencies and SROs, as well as the many documented supporters of Commodity Futures Modernization Act of 2000, who have advocated for expanding the scale of risk-taking, often while lowering the quality of oversight or accountability, and these aforementioned parties could be inspired to provide a more appropriate pool of assets to help backstop OCC. I also appreciate the following rejection reasons put forward by the SEC in the dismissal of this rule: - Failure to promote prompt and accurate clearance and settlement of securities transactions and safeguard securities and funds. - Lack of clear and direct lines of responsibility in governance arrangements. - Inadequate policies and procedures to cover credit exposures to participants and insufficient margin calculation to cover potential future exposure. In conclusion, I support the SEC in their rejection of this proposed rule change - to ensure the protection of all investors and the integrity of our financial markets. Thank you for considering my concerns and for your continued help to protect our markets. Sincerely, Household Investor