LSTA filed a 2012 comment on the SEC's securitization conflicts rule

The LSTA says it filed a comment letter with the SEC on Feb. 10, 2012, in response to the agency's proposed rule on conflicts of interest in securitizations. The file name marks it as the final version of the trade group's submission; the LSTA keeps it under policy and advocacy.

The letter is gated. The public listing shows a title, a download link, and instructions for access; the argument sits behind the login. The subject line alone places it: the SEC's proposal asked where a securitization's participants — originator, sponsor, manager, underwriter — hold interests that collide with the trust's investors. Under policy and advocacy, the LSTA's site lists 354 items. This is a single position in a file built up over years.

A manager's fee, its retention stake, and the trades it runs around a deal are the collision points — the core of CLO economics. Whatever the specifics, the LSTA's response put the group on record against the rule as written. The document has sat in the SEC's rulemaking record since that winter, for compliance teams to revisit when disclosure language gets drafted.

For private-credit managers, the letter is a reminder that the conflicts debate did not start with today's CLO volumes. The structures are far bigger and more numerous. A recent Friday brought three CLO prints, as Creditflux reported. Each was priced at $400 million. But the arrangement the SEC wanted to scrutinize — a manager assembling loans, issuing notes, and holding a piece of the deal — is exactly what the LSTA answered for in 2012. The specific anxieties behind the proposal have faded from conversation; the rulemaking record has not. The SEC's rulemaking calendar rarely moves quickly. A comment letter from 2012 is, in that context, not ancient history.