GAO reviewed the Commodity Futures Trading Commission's (CFTC) new rule on prohibitions and restrictions on proprietary trading and certain interests in, and relationships with, hedge funds and private equity funds. GAO found that (1) the final rule implements section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act), which contains certain prohibitions and restrictions on the ability of a banking entity and nonbank financial company supervised by the Board of Governors of the Federal Reserve System (the Board) to engage in proprietary trading and have certain interests in, or relationships with, a hedge fund or private equity fund. Section 619 also requires the Board, the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the Securities and Exchange Commission (SEC) to issue regulations implementing section 619 and directs CFTC and those four agencies to consult and coordinate with each other, as appropriate, in developing and issuing the implementing rules, for the purposes of assuring, to the extent possible, that such rules are comparable and provide for consistent application and implementation; and (2) CFTC complied with applicable requirements in promulgating the rule.
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