[Federal Register Volume 76, Number 46 (Wednesday, March 9, 2011)]
[Notices]
[Pages 13000-13001]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-5280]
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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.
Extension:
Rule 17a-13; SEC File No. 270-27; OMB Control No. 3235-0035.
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 provided for in the following rule: Rule 17a-13 (17 CFR
240.17a-13) under the Securities Exchange Act of 1934 (15 U.S.C. 78 et
seq.). The Commission plans to submit a request for approval of
extension of the existing collection of information to the Office of
Management and Budget.
Rule 17a-13(b) (17 CFR 17a-13(b)) generally requires that at least
once each calendar quarter, all registered brokers and dealers
physically examine and count all securities held and account for all
other securities not in their possession, but subject to the broker-
dealer's control or direction. Any discrepancies between the broker-
dealer's securities count and the firm's records must be noted and,
within seven days, the unaccounted for difference must be recorded in
the firm's records. Rule 17a-13(c) (17 CFR 17a-13(c)) provides that
under specified conditions, the securities counts, examination, and
verification of the broker-dealer's entire list of securities may be
conducted on a cyclical basis rather than on a certain date. Although
Rule 17a-13 does not require filing a report with the Commission,
discrepancies between a broker-dealer's records and the securities
counts may be required to be reported, for example, as a loss on Form
X-17a-5 (17 CFR 248.617), which must be filed with the Commission under
Rule 17a-5 (17 CFR 17a-5). Rule 17a-13 exempts broker-dealers that
limit their business to the sale and redemption of securities of
registered investment companies and interests or participation in an
insurance company separate account and those who solicit accounts for
federally insured savings and loan associations, provided that such
persons promptly transmit all funds and securities and hold no customer
funds and securities. The Rule also does not apply to certain broker-
dealers required to register only because they effect transactions in
securities futures products.
The information obtained from Rule 17a-13 is used as an inventory
control device to monitor a broker-dealer's ability to account for all
securities held, in transfer, in transit, pledged, loaned, borrowed,
deposited, or otherwise subject to the firm's control or direction.
Discrepancies between the securities counts and the broker-dealer's
records alert the Commission and the Self Regulatory Organizations
(``SROs'') to those firms having problems in their back offices.
Currently, there are approximately 5,030 broker-dealers registered
with the Commission. However, given the variability in their
businesses, it is difficult to quantify how many hours per year each
broker-dealer spends complying with the Rule. As noted, the Rule
requires a respondent to account for all securities in its possession.
Many respondents hold few, if any, securities; while others hold large
quantities. Therefore, the time burden of complying with the Rule will
depend on respondent-specific factors, including size, number of
customers, and
[[Page 13001]]
proprietary trading activity. The staff estimates that the average time
spent per respondent is 100 hours per year on an ongoing basis to
maintain the records required under the Rule. This estimate takes into
account the fact that more than half the 5,030 respondents--according
to financial reports filed with the Commission--may spend little or no
time in complying with the rule, given that they do not do a public
securities business or do not hold inventories of securities. For these
reasons, the staff estimates that the total compliance burden per year
is 503,000 hours (5,030 respondents x 100 hours/respondent).
Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information has
practical utility; (b) the accuracy of the Commission's estimates of
the burden of the proposed collection of information; (c) ways to
enhance the quality, utility, and clarity of the information 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.
The Commission may not conduct or sponsor a collection of
information unless it displays a currently valid control number. No
person shall be subject to any penalty for failing to comply with a
collection of information subject to the PRA that does not display a
valid Office of Management and Budget (OMB) control number.
Comments should be directed to: Thomas Bayer, Chief Information
Officer, Securities and Exchange Commission, c/o Remi Pavlik-Simon,
6432 General Green Way, Alexandria, Virginia 22312; or comments may be
sent by e-mail to: [email protected].
Dated: March 2, 2011.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-5280 Filed 3-8-11; 8:45 am]
BILLING CODE 8011-01-P