The Federal Reserve Board has opened the public comment period on a proposed rule that, if implemented, would allow regulators to pull certain nonbank firms under the Fed's regulatory scope by declaring them systemically important to the financial system. The proposal stems from Section 113 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and is considered among analysts to be part of the Fed's renewed interest in reining in hedge funds and nonbank, financial firms that played a role in the 2008 economic meltdown. At the same time, the rules are not specific about what companies are in the Fed's sights, which has regulators casting a wide net, analysts say. "They are looking for institutions that are interconnected to the broad capital markets," said Richard Bove with Stamford, Conn.-based Rochdale Securities. "They can cast a net widely. They are trying to control everything, but they have not defined what it is they want to control," he added. For example, Bove said traditionally nonfinancial firms like Procter & Gamble (PG) and General Electric (GE) are involved in derivatives. He says it is unclear if the net cast would consider those firms engaged in financial activities, or if it would just be firms like AIG (AIG), the insurer whose fate weighed heavily in the 2008 financial crisis. Bove added, "The thing is broad and open-ended. I'm not sure what they are going to do with it." Under the proposal, the Fed says companies "predominantly engaged in financial activities" would be subject to greater Fed scrutiny. Under the Section 113 proposed rule, a company is engaged in financial activities if 85% of its consolidated annual gross revenue or its consolidated annual assets from either of its two most recent fiscal years relate specifically to financial activities. A firm, under the rules, would automatically be significant and subject to more regulatory authority if it has $50 billion or more in total consolidated assets or is considered systemically important to the overall financial system, the Fed said. Regulators would declare nonbank, financial companies significant by analyzing the nature of their transactions and relationships with other nonbank financial firms and bank holding companies, the Federal Reserve added. Write to Kerri Panchuk.