“The Federal Reserve Bank of New York has terminated MF Global, Inc’s status as a primary dealer.” –October 31, 2011, NY Fed press release
For the details involving primary dealers and a list of those firms that are currently members of this select club, see the New York Fed website. This link: http://www.newyorkfed.org/markets/primarydealers.html and a few minutes of reading will tell the story.
Among the rules and policies of the New York Fed primary dealers you will find the following sentence. “The Bank (NY Fed) expects primary dealers to submit accurate data, but the Bank itself does not audit the data” (boldface is mine). Readers may note that regulatory oversight of primary dealers is not conducted by the NY Fed. This is so even AFTER Dodd-Frank.
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