SEC Rule Will Require Swap Parties to Verify

Stay up-to-date with the latest developments in securities law through access to both news and all statutes and regulations. Find relevant corporate filings through a searchable EDGAR database. And...

By Rob Tricchinelli

June 8 — The Securities and Exchange Commission adopted trade acknowledgement and verification requirements June 8 for security-based swap transactions, taking another step toward completing its rule package under Title VII of the Dodd-Frank Act.

Security-based swap participants must acknowledge the details of trades to their counterparty, which must then verify or dispute the acknowledgement, according to the rule adopted under Section 764(a) of Dodd-Frank.

The rule was proposed in January 2011 (11 SLD, 1/18/11). It won't take full effect until the agency finishes other Title VII requirements, including capital, margin and segregation requirements and record-keeping and reporting requirements for security-based swap entities.

“These rules will result in more accurate and timely documentation for security-based swap transactions, which is a cornerstone of effective risk management,” SEC Chairman Mary Jo White said in a news release.

The rule requires parties to electronically acknowledge the trades within 24 hours.

To contact the reporter on this story: Rob Tricchinelli in Washington at

To contact the editor responsible for this story: Phyllis Diamond at

For More Information

Request Securities & Capital Markets on Bloomberg Law