Proposed Collection; Comment Request
| Published date | 05 August 2020 |
| Citation | 85 FR 47442 |
| Record Number | 2020-17010 |
| Section | Notices |
| Court | Securities And Exchange Commission |
Federal Register, Volume 85 Issue 151 (Wednesday, August 5, 2020)
[Federal Register Volume 85, Number 151 (Wednesday, August 5, 2020)]
[Notices]
[Pages 47442-47443]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17010]
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SECURITIES AND EXCHANGE COMMISSION
[SEC File. No. 270-94, OMB Control No. 3235-0085]
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736
Extension:
Rule 17a-11
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (``PRA'') (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the existing
collection of information provided for in Rule 17a-11, Notification
Provisions for Brokers and Dealers (17 CFR 240.17a-11), under the
Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) (``Exchange
Act''). The Commission plans to submit this existing collection of
information to the Office of Management and Budget (``OMB'') for
extension and approval.
In response to an operational crisis in the securities industry
between 1967 and 1970, the Commission adopted Rule 17a-11 (17 CFR
240.17a-11) under the Exchange Act on July 11, 1971. The Rule requires
broker-dealers that are experiencing financial or operational
difficulties to provide notice to the Commission, the broker-dealer's
designated examining authority (``DEA''), and the Commodity Futures
Trading Commission (``CFTC'') if the broker-dealer is registered with
the CFTC as a futures commission merchant. Rule 17a-11 is an integral
part of the Commission's financial responsibility program which enables
the Commission, a broker-dealer's DEA, and the CFTC to increase
surveillance of a broker-dealer experiencing difficulties and to obtain
any additional information necessary to gauge the broker-dealer's
financial or operational condition.
Rule 17a-11 also requires over-the-counter (``OTC'') derivatives
dealers and broker-dealers that are permitted to compute net capital
pursuant to Appendix E to Exchange Act Rule 15c3-1 to notify the
Commission when their tentative net capital drops below certain levels.
To ensure the provision of these types of notices to the
Commission, Rule 17a-11 requires every national securities exchange or
national securities association to notify the Commission when it learns
that a member broker-dealer has failed to send a notice or transmit a
report required under the Rule.
Compliance with the Rule is mandatory. The Commission will
generally not publish or make available to any person notices or
reports received pursuant to Rule 17a-11. The Commission believes that
information obtained under Rule 17a-11 relates to a condition report
prepared for the use of the Commission, other federal governmental
authorities, and securities industry self-regulatory organizations
responsible for the regulation or supervision of financial
institutions.
The Commission expects to receive 343 notices from broker-dealers
whose capital declines below certain specified levels or who are
otherwise experiencing financial or operational problems and eleven
notices each year from national securities exchange or national
securities association notifying it that a member broker-dealer has
failed to send the Commission a notice or transmit a report required
under the Rule. The Commission expects that it will take approximately
one hour to prepare and transmit each notice. Therefore, the Commission
estimates the total annual reporting burden arising from this section
of the rule will be approximately 354 hours.\1\
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\1\ 343 hours + 11 hours = 354 hours.
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Rule 17a-11 also requires broker-dealers engaged in securities
lending or repurchase activities to either: (1) File a notice with the
Commission and their DEA whenever the total money payable against all
securities loaned, subject to a reverse repurchase agreement or the
contract value of all securities borrowed or subject to a repurchase
agreement, exceeds 2,500% of tentative net capital; or, alternatively,
(2) report monthly their securities lending and repurchase activities
to their DEA in a form acceptable to their DEA.
The Commission estimates that, annually, six broker-dealers will
submit the monthly stock loan/borrow report. The Commission estimates
each firm will spend, on average, approximately one hour per month (or
twelve hours per year) of employee resources to prepare and send the
report or to prepare the information for the FOCUS report (as required
by the firm's DEA, if applicable). Therefore, the Commission estimates
the total annual reporting burden arising from this section of the rule
will be approximately 72 hours.\2\
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\2\ 6 broker-dealers x 12 hours per year = 72 hours.
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Therefore, the total annual reporting burden associated with Rule
17a-11 is approximately 426 hours.\3\
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\3\ 343 hours + 11 hours + 72 hours = 426 hours.
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[[Page 47443]]
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
shall have 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.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB control number.
Please direct your written comments to: David Bottom, Director/
Chief Information Officer, Securities and Exchange Commission, c/o
Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or send an email
to: [email protected].
Dated: July 30, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-17010 Filed 8-4-20; 8:45 am]
BILLING CODE 8011-01-P
