CFTC should bar disclosure practice that lets banks keep funds off derivative venues, commissioner says

30 March 2019 9:26pm
The US Commodity Futures Trading Commission should abolish an identity-revealing practice that lets dealers such as Goldman Sachs effectively keep asset managers like BlackRock off dealer-only trading venues, said Commissioner Dan Berkovitz and some fund manager groups.

“That’s not a fair market,” the Democratic commissioner said in a recent interview about the swap execution facility practice that requires counterparties to reveal their identities to each other after a transaction. “It’s a barrier to entry to markets and prevents additional liquidity from coming in.”

Berkovitz said the practice, known as “post-trade name give-up,” serves no valid purpose in an era when most standardized products are cleared after being traded anonymously.