U.S. Securities and Exchange Commission and National Futures Association formalize supervisory information sharing and examination coordination

The U.S. Securities and Exchange Commission and the National Futures Association announced a memorandum of understanding that creates a formal framework for cooperation and information sharing in areas of common regulatory interest. The arrangement is intended to improve coordinated oversight of securities and derivatives firms by allowing staff to exchange information on emerging risks, examination planning and market conditions while reducing duplicative supervision. The framework applies to SEC-regulated entities, NFA members, and jointly regulated firms or affiliates. It allows each side, at its discretion and subject to applicable law, to share examination information, regulatory issues linked to firms' financial condition, and assessments of securities or derivatives market conditions that could affect supervised persons. Staff will also meet periodically to discuss risk assessment, examination findings, supervisory priorities and observed trends. The arrangement is non-binding and does not limit either party's independent authority to choose examinations or enforce its own rules. Information shared under the arrangement is presumed non-public unless the providing party states otherwise and may be used internally for examinations, investigations, proceedings, oversight and general research, subject to confidentiality and security safeguards. The memorandum took effect on signing, may be revised by agreement and can be terminated by either party on 30 days' written notice.