A rift has emerged among regulators responsible for crafting the Volcker rule, one of the most complex and contentious regulations of the landmark Dodd-Frank financial overhaul, the Wall Street Journal reported today. The dispute, between U.S. banking regulators and the Securities and Exchange Commission, casts doubt on whether regulators will finish drafting the rule by the end of the year and raises the unattractive possibility that the agencies will issue conflicting standards. The SEC and a trio of banking regulators are butting heads over how to define the buying and selling of securities on behalf of clients, as well as over banks' ability to invest in outside investment vehicles such as hedge funds. Since brokers, which are overseen by the SEC, conduct market-making activities, the SEC is pushing for more influence over the issue.
