May 18, 2024
To the protectors of market integrity, I comment today to mention the severe lack of enforcement and regulation tools the SEC has to rein in greed, fraud, or gross negligence of big financial institutions and SROs. I am deeply concerned that the issues that plague retail investors fall upon deaf ears and blind eyes, but the SEC's proposal to reject SR-OCC-2024-001 leaves hope for the proper accountability of margin requirements to be respected, due to lack of transparency from public scrutiny of financial markets it doesn't seem fair that the rules can change when Clearing Members and participants are experiencing "hard times" due to volatility. The public must rely on regulatory agencies such as yours to be the eyes and ears since they are too busy providing the very goods and services these clearing members place bets on. Just like the public is held accountable if the bills are not paid so too must the clearing members be held to a standard that can be recognized as fair, to which this proposal is not. If this proposal passes, it provides significant moral hazard as it shifts the accountability away from the very purpose (and function) of OCC to non-bank liquidity facilities creating more risk of "bills not being paid". There is a great conflict of interest if the Financial Risk Management Officer is there for the benefit of Clearing Members and the agency, it would fail to promote accurate clearance and proper timing of settlement of securities and ultimately not properly manage risk to the protection of securities and funds. Reducing margin requirements when "times are hard" for Clearing Members does not serve the public at all, in fact does the opposite as it promotes negligence and fraud at the expense of the public due to the lack of accountability of market volatility created by the bets of Clearing Members and participants. The SEC should advocate that having insufficient margin to cover potential future exposure would mean that participants cannot continue to play the game as they do and require to change the hand they have to continue to play at the table, so to speak. If not then why have rules if they only apply selectively? If this proposal goes through (and those like it) it shows a clear lack of integrity in the market as the responsibility of governance is not respected and therefore not expected to "play fair". Volatility is not an act of God, it is the direct results of the consequences the financial market revealing the hands of the players, of the events of the game unfolding for all to see, it is part of a healthy market attempting to correct itself. I support the SEC's decision in rejecting this proposed rule change and I appreciate the opportunity to express my concerns to protect all investors for a fair and transparent future for financial markets. Sincerely, An ordinary person