> Nobody is being protected here
Cracking down on a shadow derivatives exchange doing swaps with American institutions is bona fide CFTC enforcement.
Most securities law is written from an investor-protection perspective. Not swaps clearing. When everyone is writing bilateral swaps and nobody knows how much counterparty risk is accumulating with whom, you get a ticking time bomb. (This is what turned AIG into a systemic risk.) I imagine the next shoe to drop will be these firms' compliance departments.