WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission on Wednesday said parties in swaps must now acknowledge their trades electronically within a day, and also promptly verify or dispute the terms of the swap under rules it had adopted.
"These rules will result in more accurate and timely documentation for security-based swap transactions, which is a cornerstone of effective risk management," said the chair of the top U.S. securities regulator, Mary Jo White, in a statement. "They mark another significant step in completing the comprehensive regulatory framework for security-based swaps required by the Dodd-Frank Act."
The SEC only oversees a small subset of the market involving derivatives whose values are pegged to securities such as credit-default or equity swaps. The Commodity Futures Trading Commission regulates the bulk of the derivatives market.
After soured swaps helped push the country into a massive financial crisis that came to a head in 2008, lawmakers created stricter oversight of the market in the 2010 Dodd-Frank Wall Street reform law.
The SEC rules will help give regulators and traders a fuller, clearer view of the transactions. The agency said the transactions processed through a clearing agency or executed on an exchange would be exempted from the rules.
In February, the SEC approved rules governing swaps that involve foreign dealers with trading desks on U.S. soil.
(Reporting by Lisa Lambert; Editing by Bernard Orr)