The Loan Syndications and Trading Association v. Securities and Exchange Commission

Regulators erred, says the D.C. Circuit, in applying a Dodd-Frank rule requiring “securitizers” of asset-backed securities to retain 5 percent of the credit risk (so as to ensure they have skin in the game) to plaintiffs, who transfer such securities in the course of their business but do not originate or hold a stake in them. Thus, they cannot “retain” an interest, nor can the agencies require them to “obtain” one. Chevron deference does not apply because there is no ambiguity in the statute.

Tags: 2018, Administrative Law, D.C. Circuit, Dodd-Frank, Securities Law

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