Regulating Fairness: The Dodd-Frank Act’s Fair Dealing Requirement for Swap Dealers and Major Swap Participants

I. Introduction II. The Dodd-Frank Act and External Business Conduct Standards for Swap Entities ... A. Congress Reshapes the Regulatory Landscape ... B. Regulations Implementing External Business Conduct Standards ... C. The CFTC’s Fair Dealing Rule ... D. Relationship with Other External Business Conduct Standards III. Looking to NFA Guidance When Interpreting the Fair Dealing Rule ... A. Industry Familiarity with SRO “Precedents” ... 1. NFA Compliance Rules 2-2 and 2-4 ... 2. NFA’s Customer Communications Rule ... 3. NFA Interpretive Notices on the Customer Communications Rule ... i. Interpretive Notice 9003—Section-by-Section Analysis of the Customer Communications Rule ... ii. Interpretive Notice 9025—Hypothetical Performance Results ... iii. Interpretive Notice 9038—High-Pressure Sales Practices ... iv. Interpretive Notice 9039—Radio and Television Advertisements ... v. Interpretive Notice 9043—Examples of Violative Conduct ... B. Lessons from NFA Guidance for Regulation 23.433 IV. Investment Bank Misconduct Detailed in the U.S. Senate’s Anatomy of a Financial Collapse ... A. Deutsche Bank ... B. Goldman ... 1. Hudson ... 2. Anderson ... 3. Timberwolf ... 4. Abacus V. Potential Sources of Good Faith Principles for the Fair Dealing Rule ... A. Contract Law’s Implied Covenant of Good Faith and Fair Dealing ... B. Drawbacks to Using Contract Law Principles of Good Faith ... C. The “Excluder” Conceptualization of Good Faith as a Possible Model Framework for the Fair Dealing Rule ... D. Applying an Excluder Conceptualization to Regulation 23.433 VI. Conclusion