May 4, 2024
To whom it may concern, Thank you for the opportunity extended by SR-OCC-2024-001 Release No 34-99594 [1] to comment on SR-OCC-2024-001 34-99393. As a private investor in the US financial markets, I have serious concerns regarding this rule, and do not think it should implemented as written. Adjustments to margin thresholds, specifically during periods of high volatility, do not serve greater fairness and transparency in the market. Simply, without clear guidelines on how these settings are determined, there is a potential for arbitrary or ad-hoc adjustments, allowing the Options Clearing Corporation (OCC) to alter the criteria whenever Clearing Members require assistance. This flexibility raises serious concerns about fairness, as it allows for an environment to be created in which the rules can be changed based on individual circumstances, potentially favouring certain market participants and introducing a completely unnatural element of unpredictability. Such lack of transparency undermines the integrity of the US financial markets by eroding trust among participants. Markets thrive on clear and consistent rules, applied uniformly to ensure a level playing field. If rules can be adjusted opaquely and on the fly, it creates uncertainty and diminishes confidence in the regulatory framework. Maintaining trust is essential for the effective functioning of financial markets, and transparency in rule-making and enforcement is a key factor in upholding the integrity of the overall financial system. The proposal's supporting evidence, particularly regarding the calculation of margin thresholds, is troublingly redacted. This lack of disclosure undermines the principles of transparency and accountability that are crucial in regulatory frameworks. Stakeholders in the market require detailed information on how these adjustments will be made to ensure fair and equitable treatment of all market participants. Moreover, the proposal grants unchecked authority to the Financial Risk Management (FRM) Officer to make unilateral decisions during periods of high market stress. This authority, while ostensibly intended to protect the interests of the OCC, raises questions about potential conflicts of interest. The FRM Officer is entrusted with safeguarding both the OCC's interests and those of at-risk Clearing Members, creating a conflict that needs to be addressed. In light of these concerns, I urge the Securities and Exchange Commission to thoroughly reconsider the implications of Rule SR-OCC-2024-001 and to reject it as it is currently written. Clear guidelines, transparency in calculations, and checks and balances on discretionary authority are essential for maintaining the integrity and stability of the financial markets. As it is currently written, this rule is unsuitable for maintaining trust in the US financial markets. Thank you for your attention to this matter, and for the opportunity to comment. I trust that the SEC will carefully consider these concerns and take appropriate actions to address the potential risks associated with this rule. Sincerely, Tristan Henderson Scheiblerstr. 29 12437 Berlin Germany