The financial sector can expect a single proposal from the SEC sometime soon on how to coordinate the regulation of derivatives trading on a global basis, along with more attention to money market funds and a consolidated audit trail, according to Chairman Mary Schapiro.

Speaking at a legal conference on Friday, Schapiro gave a wide-ranging speech on work the Securities and Exchange Commission has already done to implement the Dodd-Frank Act—but also dropped hints at the next subjects she wants the agency to tackle. Most notable were her remarks about the over-the-counter derivatives market, a gigantic part of the financial sector that until now has largely gone overlooked. So far the SEC and the Commodities and Futures Trading Commission have proposed numerous rules about capital requirements, recordkeeping, and business conduct standards for the “swaps” dealers who trade OTC derivatives.

The tricky parts, however, are to define exactly who a swaps dealer is—a category the oil & gas industry desperately wants to avoid—and to impose a global approach to oversight of OTC derivatives, so traders won't simply decamp to London or Hong Kong and continue with business as usual from there.

“We are working hard to coordinate with our foreign counterparts to help achieve consistency among approaches to derivatives regulation,” Schapiro said Friday at the Practising Law Institute. “The Commission intends to address the most salient international issues in a single proposal. This will give interested parties an opportunity to consider, as an integrated whole, our approach to cross-border transactions and the registration and regulation of foreign entities engaged in such transactions with U.S. parties.”

Schapiro also mentioned money market funds and a consolidated audit trail as two other subjects the SEC wants to tackle, even though they aren't part of the (long) Dodd-Frank rulemaking agenda.

Money market funds are ostensibly risk-free investments, but when the Reserve Primary Fund “broke the buck” in 2008, it gave the industry for short-term debt a collective heart attack that forced the Treasury Department to guarantee such funds. “The fact is investors have been given a false sense of security by money market fund sponsor support and the one-time Treasury guarantee,” Schapiro said. “Funds remain vulnerable to the reality that a single money market fund breaking of the buck could trigger a broad and destabilizing run.”

Schapiro said the SEC is considering two ideas: requiring money market funds to float their net asset value, or imposing some sort of capital requirements, combined with limitations or fees on redemptions.

The consolidated audit trail is another project the SEC wants to accomplish, so it will have an easier path to unravel events such as the infamous flash crash of May 2010. The SEC has proposed its vision for such an audit trail, but Schapiro admitted that the idea is a complex one that won't be easy to accomplish. She also noted that while the original SEC proposal covers the equities markets, eventually she would like a system that encompasses fixed-income investments, futures, and other markets.