US Federal Deposit Insurance Corporation And US Securities Exchange Commission Issues Proposed Rule Regarding The Orderly Liquidation Of Covered Broker-Dealers
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On February 17, 2016, the FDIC and the US Securities and Exchange Commission jointly issued a proposed rule to implement provisions for the orderly liquidation of covered brokers and dealers...
On February 17, 2016, the FDIC and the US Securities and
Exchange Commission jointly issued a proposed rule to implement
provisions for the orderly liquidation of covered brokers and
dealers as required under Title II of the Dodd-Frank Wall Street
Reform and Consumer Protection Act. Specifically, Title II provides
for federal receivership proceedings of qualifying financial
companies, including covered broker-dealers, with the FDIC serving
as receiver. The proposed rule defines a covered broker or dealer
as any covered financial company that is registered with the SEC as
a broker or dealer and is a member of the Securities Investor
Protection Corporation. A covered financial company is generally
one that is in danger of default and whose failure would have
serious adverse effects on US financial stability, as determined by
the Secretary of the Treasury. In the case of covered
broker-dealer, the FDIC will serve as receiver, but the SIPC will
serve as trustee.
Comments on the proposed rule must be received within 60 days
after the date of publication in the Federal Register.
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