Debevoise Discusses Proposed SEC Rule to Prohibit Conflicts of Interest in Certain Securitizations

On January 25, 2023, the U.S. Securities and Exchange Commission (“SEC”) issued a proposed rule to prohibit material conflicts of interest in the sale of asset-backed securities (“ABS”). The proposed rule is a re-proposal of a rule that was first proposed in 2011 and is required by section 27B of the Securities Act of 1933[1] (the “Securities Act”), a provision added by Section 621 of the Dodd-Frank Act.  As the initial proposal was subject to substantial industry commentary, much of the preamble to the re-proposal is directed at addressing previous comments.  If adopted this time, the proposed rule would … Read more