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Spoofing, Surveillance and Supervision

Jay Biondo, Product Manager - Surveillance at Trading Technologies, co-authored an article along with James Lundy and Nicholas Wendland, both of Drinker Biddle & Reath LLP, reviewing the CFTC's regulations and expanding efforts, 21st century surveillance and supervision, as well as strategic recommendations.

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March 1, 2002

SIA's Radical Post-Trade Change

By Gregory Bresiger

Today's industry-wide trading systems are straining and radical change is needed. That's the comment of a Securities Industry Association committee that has delivered a report entitled "Institutional Transaction Processing Model."

The strain in processing trading will become worse, the report said, with the expansion of trading hours and, "the volume implications of decimalization."

The SIA's T+1 Institutional Transaction Processing Committee is proposing radical changes in the trading model.

"The most significant of these," according to the committee report, "is the recommendation that a deadline of 30 minutes after the end of trading be set by all final cumulative NOEs (notice of executions), including net amounts, must be received by the VMU (Virtual Matching Utility) from the executing broker dealers. In addition, a deadline of 30 minutes after the receipt of final cumulative NOEs, has been recommended by which all allocations, including net amounts (i.e. fully configured trade at the account level) must be received by the VMU from investment managers."

The report also warns that action must be taken because the industry is, "already experiencing a marked reduction in processing efficiency."