Proprietary Trading Prohibition of the Dodd-Frank Volcker Rule

October 2011
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Proprietary Trading Prohibition of the Dodd-Frank Volcker Rule

At a glance

October 2011 - The Volcker Rule proprietary trading prohibition would be the most far-reaching regulation in US financial history by prohibiting FDIC-insured institutions and any affiliate regardless of its business or geographic location.

The Federal Reserve, FDIC, OCC and SEC recently issued the long-awaited proposed rule implementing the Volcker Rule of the Dodd-Frank Act. The Proposed Rule, which closely follows the language and presumptions spelled out in the Act, constructs the most far-reaching regulatory prohibition in US financial history by prohibiting proprietary trading not only in FDIC-insured institutions, but also in any affiliate thereof.

This A Closer Look focuses primarily on the proprietary trading aspects of the Proposed Volcker Rule. We cover the fund aspects of the Proposed Rule in another A Closer Look titled The Volcker Rule Proposal: Regulators Propose Restrictions on "Covered Funds". Our objective here is not to provide a detailed analysis of the Proposed Rule, but rather to try and help answer the broader question - "what should I do now?"

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