Feb. 27, 2024
Dear Members of the SEC, I am writing to express my concerns regarding Rule SR-OCC-2024-001, which grants the Options Clearing Corporation (OCC) outsized authority to adjust margin thresholds during periods of market volatility based on undisclosed parameters. Despite seeking risk management measures, the lack of transparency surrounding the parameters used by the OCC raises serious concerns about fairness and market stability. Allowing the OCC to adjust margin thresholds without disclosing the specific criteria or methodology introduces a level of uncertainty that could potentially undermine market integrity and investor confidence. Furthermore, the use of "global control settings" during critical market events, such as the GameStop run-up in January 2021, without clear guidelines or oversight, exacerbates these concerns. The OCC's ability to make idiosyncratic adjustments to its risk management practices, particularly during times of heightened volatility, without adequate transparency or accountability, poses a significant risk to market participants. In light of these concerns, I urge the Securities and Exchange Commission to carefully evaluate Rule SR-OCC-2024-001 and consider implementing measures to enhance transparency and accountability in the OCC's risk management practices. This may include requiring the OCC to disclose the parameters used to adjust margin thresholds, establishing clear guidelines for the use of global control settings, and increasing regulatory oversight to ensure that these adjustments are made in a fair and equitable manner. Thank you for considering my comments on this important matter. I believe that by addressing these concerns, we can help promote a more transparent and resilient financial system that serves the best interests of all market participants. Sincerely, Andrew Gabany