The Securities and Exchange Commission recently issued a request for comments on proposed changes to the rules regulating asset-backed securities. Part of the suggested changes included a requirement to file a computer program of the contractual cash flow provisions expressed in a particular computer language – Python.
The detailed set of comments addresses some specific issues with the proposal, which include the need to make sure that all inputs and outputs for the program are at the same level of detail as the Asset Data File. Those issues prompted USACM and SIGPLAN to recommend the final proposal be run as a trial. A summary of the comments emphasizes the following points.
- Other programming languages may be more appropriate than Python.
- An interpreted language is neither sufficient nor necessary to achieve the goals outlined by the SEC.
- Security should be enhanced by executing the code in a “virtual sandbox.”
- All inputs and outputs of the waterfall program must be specified precisely.
- The SEC should consider developing a domain-specific programming language or library for writing waterfall programs.
You can read the full set of comments online, either at the USACM website, or at the SEC website.