[Federal Register Volume 75, Number 209 (Friday, October 29, 2010)]
[Notices]
[Pages 66805-66806]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-27366]
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SECURITIES AND EXCHANGE COMMISSION
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: U.S. Securities and
Exchange Commission, Office of Investor Education and Advocacy,
Washington, DC 20549-0213.
Existing Collection in Use Without an OMB Number: Rule 8c-1; SEC File
No. 270-455; OMB Control No. 3235-0514.
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the collection of
information summarized below. The Commission plans to submit this
existing collection of information to the Office of Management and
Budget for Approval.
Rule 8c-1 (17 CFR 240.8c-1) under the Securities Exchange Act of
1934 (15 U.S.C. 78a et seq.) generally prohibits a broker-dealer from
using its customers' securities as collateral to finance its own
trading, speculating, or underwriting transactions. More specifically,
the rule states three main principles: first, that a broker-dealer is
prohibited from commingling the securities of different customers as
collateral for a loan without the consent of each customer; second,
that a broker-dealer cannot commingle customers' securities with its
own securities under the same pledge; and third, that a broker-dealer
can only pledge its customers' securities to the extent that customers
are in debt to the broker-dealer. See Securities Exchange Act Release
No. 2690 (November 15, 1940); Securities Exchange Act Release No. 9428
(December 29, 1971). Pursuant to Rule 8c-1, respondents must collect
information necessary to prevent the hypothecation of customer accounts
in contravention of the rule, issue and retain copies of notices to the
pledgee of hypothecation of customer accounts in accordance with the
rule, and collect written consents from customers in accordance with
the rule. The information is necessary to ensure compliance with the
rule, and to advise customers of the rule's protections.
There are approximately 111 respondents per year (i.e., broker-
dealers that conducted business with the public, filed Part II of the
FOCUS Report, did not claim an exemption from the Reserve Formula
computation, and reported that they had a bank loan during at least one
quarter of the current year) that require an aggregate total of 2,498
hours to comply with the rule. Each of these approximately 111
[[Page 66806]]
registered broker-dealers makes an estimated 45 annual responses, for
an aggregate total of 4,995 responses per year. Each response takes
approximately 0.5 hours to complete. Thus, the total compliance burden
per year is 2,498 burden hours. The approximate cost per hour is $59,
resulting in a total cost of compliance for the respondents of
approximately $147,382 (2,498 hours @ $59 per hour).
Written comments are invited on: (a) Whether the collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information shall have practical
utility; (b) the accuracy of the agency's estimate of the burden of the
proposed collection of information; (c) ways to enhance the quality,
utility, and clarity of the information to be collected; and (d) ways
to minimize the burden of the collection of information on respondents,
including through the use of automated collection techniques or other
forms of information technology. Consideration will be given to
comments and suggestions submitted in writing within 60 days of this
publication.
Please direct your written comments to: Jeffrey Heslop, Acting
Chief Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 6432 General Green Way, Alexandria, Virginia 22312 or
send an e-mail to: [email protected].
Dated: October 25, 2010.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-27366 Filed 10-28-10; 8:45 am]
BILLING CODE 8011-01-P