Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

A Member of the Law Professor Blogs Network

Sunday, May 9, 2010

Reiffen & Robe on Demutualization of Exchanges

Demutualization and Customer Protection at Self-Regulatory Financial Exchanges, by David Reiffen, U.S. Commodity Futures Trading Commission (CFTC), and Michel A. Robe, American University - Kogod School of Business, was recently posted on SSRN.  Here is the abstract:

In the past decade, many of the world’s largest financial exchanges have demutualized, i.e., converted from mutual, not-for-profit organizations to publicly-traded, for-profit firms. In most cases, these exchanges have substantial responsibilities with respect to enforcing various "trade practice" regulations that protect investors from dishonest agents. We examine how the incentives to enforce such rules change as an exchange demutualizes. In contrast to oft-stated concerns, we find that, in many circumstances, an exchange that maximizes shareholder (rather than member) income has a greater incentive to aggressively enforce these types of regulations.

http://lawprofessors.typepad.com/securities/2010/05/reiffen-robe-on-demutualization-of-exchanges.html

Law Review Articles | Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef0133ed6b8ea1970b

Listed below are links to weblogs that reference Reiffen & Robe on Demutualization of Exchanges:

Comments

Post a comment