Regulators Tackle Pre-Hedging and Market Manipulation
Global regulators are grappling with pre-hedging and market manipulation, with IOSCO probing pre-hedging and FINRA using AI to detect illicit activities.
Former U.S. regulators have voiced their satisfaction with the outcomes of the Basel Committee on Banking Supervision, emphasizing the importance of continued U.S. participation in the international regulatory framework. This comes amid rising skepticism from some quarters of the current administration regarding the efficacy of Basel rulemaking.
The Basel Committee on Banking Supervision was established to enhance financial stability by improving the quality of banking regulation worldwide. It aims to create a level playing field for banks across different jurisdictions, ensuring that they maintain adequate capital and risk management practices.
Randal Quarles, a former vice-chair of supervision at the Federal Reserve, highlighted that the Basel framework has historically aligned with U.S. interests. He noted that the U.S. has been a driving force in shaping the rules that govern international banking practices.
Despite the positive feedback from former regulators, some officials within the current administration have expressed doubts about the Basel process. They argue that it may lead to an “outsourcing” of regulatory authority, potentially undermining U.S. sovereignty in financial regulation. This skepticism raises concerns about the future of U.S. participation in the Basel Committee.
Former regulators are urging the current administration to remain engaged with the Basel Committee. They argue that withdrawing from these discussions could jeopardize the favorable regulatory environment that the U.S. has worked hard to establish.
As discussions around the Basel framework continue, the voices of former regulators serve as a reminder of the importance of U.S. involvement in international banking regulation. Their insights underscore the need for a balanced approach that considers both national interests and the benefits of global cooperation in financial oversight.
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