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Article
The Regulation of U.S. Money Market Funds: Lessons from Europe
9 BYU Int’l L. & Mgmt. Rev. 201 (2013)
  • Latoya C. Brown
Abstract

The recent financial crisis challenged long held perceptions of money market funds (“MMFs”) as stable and highly liquid instruments. Regulators in the US and in Europe now seek to impose additional rules on MMFs to avoid another significant failure as happened to the Reserve Fund. In the US, the debate is drawing even more media attention as question of which regulatory body - such as the Securities and Exchange Commission, the Treasury Department, and the Financial Stability Oversight Council – should lead the way has taken interesting twists and turns. This paper examines primary reform options being proposed in the US, and concludes that the additional rules implemented by the SEC in 2010 can adequately buttress the perceived weaknesses of the MMF industry, which has for the most part proven itself reliable. If, after detailed study and analysis, regulators believe that the fund industry could still be strengthened, the proposal of a capital buffer is the most promising option. The paper’s ultimate conclusion is informed by the experiences of the European funds which can provide invaluable lessons for US regulators on what options are viable.

Keywords
  • securities,
  • money market fund,
  • mutual fund,
  • financial crisis,
  • global markets,
  • SEC,
  • financial services industry,
  • regulatory framework,
  • shareholders,
  • Dodd-Frank
Publication Date
Summer 2013
Publisher Statement
For any republication of this article, credit must be given to BYU Int’l L. & Mgmt. Rev. as the original publisher and the author must be credited.
Citation Information
Latoya C. Brown. "The Regulation of U.S. Money Market Funds: Lessons from Europe" 9 BYU Int’l L. & Mgmt. Rev. 201 Vol. 9 (2013)
Available at: http://works.bepress.com/latoya_brown/2/