Many over-the-counter derivatives transactions are complex and challenging, even to the drafters of the documents. Title VII of the Dodd- Frank Wall Street Reform and Consumer Protection Act of 2010 (the ‘‘Dodd-Frank Act’’) made this opaque market more transparent, but the hundreds of new Commodity Futures Trading Commission (‘‘CFTC’’) swaps rules, guidances, interpretations, FAQs, time-limited no-action letters, private telephone consultations with the CFTC staff, industry lawsuits and court decisions, have added a level of regulatory uncertainty. The derivatives bar has organized hundreds of continuing legal education conferences to decipher the new derivatives rules of the road. It has been a challenge. There are important ‘‘red flags’’ that should cause derivatives lawyers to proceed with a great degree of caution, to protect our clients from engaging in wrongful or questionable conduct and to ensure that we are acting responsibly and ethically.
Reproduced with permission from Securities Regulation & Law Report, 47 SRLR 2182, 11/16/15. Copyright 2015 by The Bureau of National Affairs, Inc. (800-372-1033) http://www.bna.com