Wall Street’s Shady Swap Trades Spark Pushback From Regulators

Wall Street’s push to clean up a $10 trillion corner of the derivatives market is getting poor reviews from an important audience: global financial regulators.

Behind closed doors, watchdogs from Washington to London have made clear that a fix the industry came up with this year to crack down on shady deals falls short of what’s needed, said people familiar with the matter. The focus of the scrutiny is credit default swaps -- instruments tainted by the 2008 financial crisis that traders use to cash in when companies miss bond payments.