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Commissioner Signals Intent To Expand Authority Over Federal Bank Subsidiaries

Last month, Commissioner of Business Oversight Jan Owen issued an invitation for comment on two proposed rules that would subject non-depository operating subsidiaries, affiliates and agents of federal banks and other financial institutions to licensing under the California Finance Lenders Law or the Residential Mortgage Lending Act.  I found this proposal to be particularly interesting…

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Are Issuers Of Options Broker-Dealers?

In the last two posts, I’ve been discussing standardized options trading.  Today, I address the question of whether persons engaged in the regular business of issuing options may fall within the definition of a “broker-dealer” for purposes of the Corporate Securities Law of 1968.  The short answer is that they can. In Standardized Options – Who’s Your Daddy?,…

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Options Trading Without The Issuer’s Consent

In yesterday’s post, I discussed secondary trading of standardized options and noted that the SEC has taken the position that in the case of standardized options the issuer is The Options Clearing Corporation.  This leads to the question of whether the issuer of an underlying security has any say in deciding if there will be secondary trading in standardized options to acquire its security. …

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Standardized Options – Who’s Your Daddy?

A securities call option is a derivative security representing the right, but not the obligation, to acquire an underlying security.  When the person selling an option is also the issuer of the underlying security, then there is no question that that person is also the issuer of the option.  See Section 2(a)(4) of the Securities Act of 1933…

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