Aug. 23, 2026
Re: Joint Request for Comment on Swap and Security-Based Swap Data Reporting File No. S7-2026-22 | RIN 3038-AF70 We submit this comment in our individual capacities as practitioners with direct experience in post-trade securities operations and software infrastructure. We write in response to the Commissions' joint request for public input on harmonizing, modernizing, and streamlining data reporting requirements for swap and security-based swap markets. Our comment addresses a structural gap the Commissions have correctly identified: the absence of a canonical, multi-party trade record that can serve as a shared reference across reporting frameworks, counterparties, and asset classes. We believe the Commissions' harmonization initiative presents a timely opportunity to define such a record as the foundational data primitive for modern post-trade infrastructure. I. The Core Problem: Fragmented Identity Across Three Parties Every securities transaction involves at least three institutional parties: an asset manager originating the order, an executing broker-dealer routing and filling it, and a custodian bank holding the assets and settling the obligation. Each party maintains its own internal representation of the same trade event, generated from its own systems, using its own identifiers, timestamps, and data schemas. There is no shared, authoritative record that all three parties attest to at the point of execution. What exists instead is a reconciliation process: each party compares its internal record against counterparty confirmations and settlement instructions, resolving discrepancies manually or through bilateral messaging protocols such as FIX, SWIFT MT515, and DTCC CTM/ALERT. These protocols were designed for bilateral communication, not multi-party attestation. They produce confirmation, not a single shared record of truth. The consequences are not abstract. Post-trade reconciliation failures cost the U.S. securities industry an estimated $3-5 billion annually in failed settlements, manual intervention, and operational overhead. Under T+1 settlement, the compression of the reconciliation window has made fragmented identity across counterparties not merely inefficient but structurally incompatible with the settlement timeline regulators have mandated. The swap and security-based swap reporting frameworks the Commissions are seeking to harmonize inherit this same problem. Reporting obligations are triggered by each party independently, using identifiers that are generated, maintained, and reconciled separately. The Unique Transaction Identifier (UTI) and Legal Entity Identifier (LEI) frameworks address part of the problem, but they operate at the transaction and entity level — not at the level of the multi-party trade record itself. A UTI identifies a transaction. It does not constitute a shared attestation that all parties to that transaction agree on every material data element of the record. The same fragmentation extends beyond swap reporting to the full lifecycle of securities positions. Tax-lot level accounting — which requires agreement among asset manager, broker-dealer, and custodian on acquisition date, cost basis, and lot identity — relies on the same bilateral reconciliation process and produces the same categories of discrepancy. Inter-custodian journal transfers introduce an additional failure point: there is no standardized multi-party record of what was transferred, at what cost basis, or with what tax treatment. These are not edge cases. They are routine workflows that affect every institutional account and every year-end tax reporting cycle. A canonical multi-party trade record standard that addresses swap reporting harmonization will fail to achieve its full objectives if it does not account for the position-level data that governs how those trades are accounted for downstream. II. The Category of Solution A canonical multi-party trade record — a single data object that all three parties attest to at the point of trade execution, before settlement instructions are generated — represents the category of solution the Commissions' harmonization initiative requires. Such a record would serve as the shared reference from which each party's reporting obligations are drawn, replacing the current model in which each party reports from its own independently maintained internal representation of the same event. We do not propose a specific technical standard in this comment. We believe that standard should emerge from a structured engagement between regulators, infrastructure providers, and market participants — one that accounts for the full range of asset classes, settlement rails, and reporting frameworks the Commissions oversee. What we submit here is the problem definition and the category of solution. We would welcome the opportunity to engage further with Commission staff on both. III. Recommendations We respectfully recommend that the Commissions consider the following as part of their harmonization initiative: 1. Define a canonical multi-party trade record schema as a regulatory reference standard, specifying the minimum required data elements, attestation requirements, and versioning rules that any compliant record must satisfy. This schema should be developed through a public standards process with participation from asset managers, broker-dealers, custodians, and infrastructure providers. 2. Require that swap and security-based swap reports reference a canonical record identifier where one exists, in addition to the UTI and LEI. We recommend that any such identifier framework be implemented through certified private operators functioning under regulatory oversight, consistent with the model established for swap data repositories under Dodd-Frank. This creates a direct linkage between the regulatory reporting framework and the underlying attested record, while preserving a market structure in which implementation is driven by regulated private infrastructure rather than government-operated systems. 3. Establish a timeline for canonical record adoption aligned with the Commissions' broader harmonization milestones, including the DTCC ISO 20022 transition scheduled for Q3 2027 and the ESMA machine-readable allocations mandate effective December 2026. These infrastructure transitions represent natural integration points for canonical record adoption across asset classes and reporting frameworks. We believe the canonical multi-party trade record is not a new infrastructure layer but the missing data primitive that makes the existing infrastructure work as intended. The Commissions' harmonization initiative is the right moment to begin defining it - and we look forward to contributing to that process. We appreciate the opportunity to submit this comment and welcome any follow-up from Commission staff. Respectfully submitted, --- This comment is submitted by the above-named individuals in their personal capacities and do not represent the views of any employer or affiliated organization. Sent from Proton Mail for iOS.