Yesterday, we spoke with CFTC and Congress about how new regulation coming out of Washington would affect traders. We also sat down with former CFTC Chair Sharon Brown-Hruska, now a vice president in NERA's securities and finance practice. Brown-Hruska says that while it's justified for the CFTC to crack down on illegal forex operations, the agency's current proposal to limit leverage in OTC forex to 10:1 "overshoots the mark."
She says with the current proposal there's the potential to damage legitimate traders and that killing the market would not solve the fraud problem.
Daniel Waldman, partner at Arnold & Porter LLP and former general counsel at CFTC, says that although it's uncertain what form pending legislation will take, that regulatory changes ARE coming. He says that the bottom line is that we will see new legislation and traders, therefore, need to follow developments on the regulatory front.
Brown-Hruska agrees, saying that the trading community "needs to make their voice heard" as new regulations are set to change the way they do business.
For more from our Washington insiders, including background and details on pending legislation, check out our feature story in the April issue.