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A-Team Insight Blogs

DPC DATA MuniGUARD Addresses Bond Dealers’ Mounting MSRB and Finra Compliance Concerns

DPC DATA, a provider of municipal bond disclosure data, research and data services, today announced that its new surveillance service, MuniGUARD, is helping municipal bond dealers address mounting regulatory demands and enforcement pressures related to investor protections. Providing automated notice of the latest material event filings, which can be integrated directly into trading and compliance platforms, MuniGUARD reduces both legal risks and operational costs for dealers.

“Several major dealer organisations have already deployed MuniGUARD, giving their trading desks and wealth management departments the latest business critical filings on the bonds they buy and sell. For these firms, MuniGUARD is an essential tool for protecting their customers and themselves in this deteriorating credit environment,” says Peter Schmitt, CEO of DPC DATA. “There is no question that new material filings, particularly those indicating bond distress, can instantly change the credit profile and pricing of municipal bonds. MuniGUARD places this information directly into dealers’ hands in their everyday workflow.”

In the wake of recent announcements by the Municipal Securities Rulemaking Board (MSRB) and the Financial Industry Regulatory Authority (Finra) related to disclosure related practices, dealers are facing more detailed regulatory requirements and increased industry enforcement. Finra has announced an industry-wide “sweep” to determine dealer compliance with MSRB rules for fair dealing, fair pricing and determining the suitability of an investment for bond buyers. Subsequently the MSRB released a new interpretive notice to dealers indicating that they are not only responsible for access to material secondary market disclosures in meeting these regulations, but they are also responsible for interpreting and disclosing this content to investors.

Until MuniGUARD, time consuming and expensive labour was required to track these unscheduled material event filings by issuers and obligors. The MSRB’s recently launched EMMA system, which is also DPC DATA’s main source for new disclosure filings, offers timely access to official materials. However, users must query the system by one Cusip number at a time to discover if new filings exist. In contrast, DPC DATA provides timely direct feeds of material event information, along with direct access to the documents.

“Today, no one wants to wait or dig for this information. Since the launch of MuniGUARD in June, our first customers have discovered that MuniGUARD can be deployed quickly in the systems they already use to manage offerings and keep track of customer positions,” says Michael Ruvo, president of DPC DATA. “There is no more efficient solution than MuniGUARD to the universal problem of staying on top of critical disclosure information in a timely manner.”

To optimise usability for the dealer community, MuniGUARD can be delivered as a data feed for integration into trading systems, risk management applications, intranet portals and other internal systems, or through DPC DATA’s MuniLINK custom API for web services. The customisable MuniGUARD content includes descriptive data pertaining to each notice at the Cusip nine level and a direct link to the definitive electronic document for each material event notice.

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