Fornecimento De Formulário 4 Investitopedia Forex

Tempo Real após Horas Pré-Mercado Notícias Resumo das Cotações Resumo Citação Gráficos Interativos Configuração Padrão Por favor, note que uma vez que você faça sua seleção, ela se aplicará a todas as futuras visitas ao NASDAQ. Se, a qualquer momento, estiver interessado em voltar às nossas configurações padrão, selecione Configuração padrão acima. Se você tiver dúvidas ou tiver problemas na alteração das configurações padrão, envie um e-mail para isfeedbacknasdaq. Confirme sua seleção: Você selecionou para alterar sua configuração padrão para a Pesquisa de orçamento. Esta será agora a sua página de destino padrão, a menos que você altere sua configuração novamente ou exclua seus cookies. Tem certeza de que deseja alterar suas configurações? Temos um favor a perguntar Desabilite seu bloqueador de anúncios (ou atualize suas configurações para garantir que o javascript e os cookies estejam ativados), para que possamos continuar fornecendo as novidades do mercado de primeira linha E os dados que você espera de nós. Publicações do Investidor Guia de Registro de Corretores de Divisão Divisão de Negociação e Mercados 1 Comissão de Valores Mobiliários dos EUA Abril de 2008 Índice Introdução Quem é necessário para se registrar Quem é um quotBrokerquot Quem é um quotDealerQue fazer Se você acha que pode ser um corretor ou um revendedor corretores e negociantes geralmente devem se registrar com a SEC Pessoa afiliada de um corretor-revendedor Interstate Broker-Dealers Broker-Dealers que limitam o seu negócio para excluídos e isentos Securities corretor-Dealers devem se registrar antes de vender Valores Mobiliários Não Registados - Incluindo Posições Privadas (ou Ofensas da Regulamentação D) Isenção da Emissora Exigências de Exoneração de Corretores e Revendedores Externos sobre Corretores e Negociantes de Títulos Governamentais e Municipais, incluindo Contratos de Recompra Regras Especiais Aplicáveis ​​a Bancos e Outras Instituições Financeiras Agentes e Corretores Imobiliários Relações entre Agentes e Corretores com Grupos de Afinidade Como Registrar-se como um Formulário de Agente-Corretora Assinatura do BD SRO Afiliação SIPC Requisitos do Estado Pessoas Associadas Sucessor Corretor-Registro de Proprietário Retirada de Registro Cancelamento de Registro Segurança Futuros Regulamentação de Negociadores de Corretores Antifraude (Regulação SHO) Negociação durante uma Oferta (Regulamento M) Restrições sobre Negociação Privada Restrições sobre Operações de Valores Mobiliários Privados Analistas e Regulação Negociação de Ações por Membros De Intercâmbios, Corretores e Concessionárias Estendendo Crédito sobre Novas Emissões Regulamento NMS Ordem Execução Obligações Regulamento ATS: Broker-Dealer Sistemas de Negociação Penny Stock Regras Privacidade do Consumidor Informação Financeira (Regulamento SP) Assessor de Investimento Registo Arbitragem Responsabilidade Financeira de Broker-Dealers Net Capital Rule Use Registros e Relatórios Requisitos de Avaliação de Riscos Outros Requisitos Exames e Inspeções Programa de Valores Perdidos e Roubados Requisito de Impressões Digitais Uso de Mídia Eletrônica por Agentes de Corretagem Assinaturas Eletrônicas Programa de Lavagem de Dinheiro Escritório de Controle de Ativos Estrangeiros Planos de Continuidade de Negócio Onde Para obter mais informações I. INTRODUÇÃO O Securities Exchange Act de 1934 (quot Exchange Act ou quotActquot) governa a forma como os mercados de valores mobiliários da nação e seus corretores e concessionários operam. Preparamos este guia para resumir algumas das disposições significativas da Lei e suas regras. Você vai encontrar informações sobre se você precisa se registrar como um corretor-revendedor e como você pode se registrar, bem como os padrões de conduta e as regras de responsabilidade financeira que os corretores devem seguir. CUIDADO mdash CERTIFIQUE-SE DE QUE SIGA TODAS AS LEIS E REGRAS Embora este guia destaque certas disposições da Lei e nossas regras, não é abrangente. Os corretores e revendedores e suas pessoas associadas devem cumprir todos os requisitos aplicáveis, incluindo os da Comissão de Valores Mobiliários dos Estados Unidos ("SEC" ou "Comissão"), bem como os requisitos de qualquer organização autorreguladora a que pertençam os corretores e revendedores, E não apenas aqueles resumidos aqui. A equipe da SEC está pronta para responder suas perguntas e ajudá-lo a cumprir com nossas regras. Depois de ler este guia, se você tiver dúvidas, entre em contato com o Escritório de Interpretação e Orientação (202) 551-5777 (e-mail tradingandmarketssec. gov) ou o Escritório Regional da SEC em sua área. Você encontrará uma lista de números de telefone úteis no final deste guia, ou no site da SEC39 em sec. gov/contact. shtml. Você pode querer consultar com um advogado particular que esteja familiarizado com as leis de títulos federais, para garantir que você cumpra todas as leis e regulamentos. A equipe da SEC não pode agir como advogado de um indivíduo ou advogado do corretor. Enquanto a equipe tenta fornecer orientação por telefone para os indivíduos que estão fazendo inquéritos, a orientação é informal e não vinculativo. A orientação formal pode ser buscada através de um inquérito escrito que seja consistente com as diretrizes da SEC39 para solicitações não-ação, interpretativas e isentas. II. QUEM É NECESSÁRIO REGISTAR A maioria dos quotbrokers e quotdealers deve se registrar com a SEC e se juntar a uma organização quotself-reguladora, ou SRO. Esta seção cobre os fatores que determinam se uma pessoa é um corretor ou revendedor. Ele também descreve os tipos de corretores e negociantes que não têm de se registrar com a SEC. As organizações de auto-regulação estão descritas na Parte III, abaixo. Uma nota sobre os bancos: o Exchange Act também contém disposições especiais relativas à corretagem e atividades de negociação dos bancos. Ver Secções 3 (a) (4) (B) e 3 (a) (5) (C) e disposições relacionadas, e consultar o advogado. Aspectos da atividade dos negociantes de bancos são discutidos em uma publicação emitida pela Divisão de Negociação e Mercados da SEC39, intitulada "Guia de Conformidade de Bancos sobre Excepções e Regras Estatutárias de Negociante", que está disponível no site da SEC39s em: sec. gov/divisions/marketreg /bankdealerguide. htm. A actividade de corretagem bancária é abordada no Regulamento R, que foi adoptado conjuntamente pela Comissão e pelo Conselho de Governadores do Sistema da Reserva Federal. Consulte a Lei de Câmbio nº 56501 (24 de setembro de 2007) sec. gov/rules/final/2007/34-56501.pdf. A. Quem é um bêbado A Seção 3 (a) (4) (A) da Lei geralmente define um "quotbroker" como uma pessoa envolvida no negócio de efetuar transações em valores mobiliários por conta de outrem. Às vezes você pode facilmente determinar se alguém é um corretor. Por exemplo, uma pessoa que executa transações para outros em uma troca de títulos é claramente um corretor. No entanto, outras situações são menos claras. Por exemplo, cada um dos seguintes indivíduos e empresas pode precisar se registrar como um corretor, dependendo de uma série de fatores: quotfinders, quotbusiness corretores, quot e outros indivíduos ou entidades que se envolvem nas seguintes atividades: Encontrar investidores ou clientes para, (Ou fundos de investimento, incluindo hedge funds) ou outros intermediários de valores mobiliários Encontrar clientes de bancos de investimento para corretores registados Encontrar investidores para quotissuersquot (entidades emitentes de valores mobiliários), mesmo numa (Ou seja, actividades relacionadas com fusões e aquisições em que os valores mobiliários estão envolvidos) consultores de investimento e consultores financeiros corretores de bolsa estrangeiros que não podem confiar em investidores de capital de risco ou de financiamento de capital de risco, incluindo colocações privadas Em conformidade com a Regra 15a-6 da Lei (discutida a seguir), pessoas que operam ou controlam plataformas electrónicas ou outras para negociar valores mobiliários que comercializam interesses de investimento imobiliário, tais como interesses de arrendamento em comum, Agentes para colocações privadas de valores mobiliários pessoas que comercializam ou efetuam transações em produtos de seguros que são valores mobiliários, tais como anuidades variáveis ​​ou outros produtos de investimento que são pessoas que executam transações de valores mobiliários por conta de outrem por uma taxa, mesmo quando essas outras pessoas São amigos ou membros da família pessoas que prestam serviços de apoio a corretores registrados e pessoas que atuam como contratistas independentes, mas não são pessoas associadas de um corretor (para informações sobre as pessoas associadas, veja abaixo). A fim de determinar se qualquer um desses indivíduos (ou qualquer outra pessoa ou empresa) é um corretor, olhamos para as atividades que a pessoa ou negócio realmente executa. Você pode encontrar análises de várias atividades nas decisões de tribunais federais e nossas próprias cartas de não-ação e interpretativas. Aqui estão algumas das perguntas que você deve fazer para determinar se você está agindo como um corretor: Você participa em partes importantes de uma transação de valores mobiliários, incluindo solicitação, negociação ou execução da transação A sua compensação para a participação na transação dependem Sobre ou está relacionado com o resultado ou o tamanho da transação ou negócio Você recebe comissões de faturamento, tais como 12b-1 taxas Você recebe qualquer outra compensação relacionada com a transação Você está envolvido no negócio de efetuar ou facilitar os títulos Transações Você lida com os valores mobiliários ou fundos de outros em conexão com transações de valores mobiliários Uma resposta quotyesquot para qualquer uma dessas perguntas indica que você pode precisar se registrar como um corretor. B. Quem é um "comerciante" Ao contrário de um corretor, que age como agente, um negociante atua como principal. O Artigo 3 (a) (5) (A) da Lei geralmente define um quotdealer como: qualquer pessoa envolvida no negócio de compra e venda de valores mobiliários para sua própria conta, através de um corretor ou de outra forma. A definição de quotdealer não inclui um quottrader, isto é, uma pessoa que compra e vende títulos para sua própria conta, individualmente ou em uma capacidade fiduciária, mas não como parte de um negócio regular. Indivíduos que compram e vendem títulos para si geralmente são considerados comerciantes e não revendedores. Às vezes você pode facilmente dizer se alguém é um revendedor. Por exemplo, uma empresa que anuncia publicamente que faz um mercado de valores mobiliários é, obviamente, um revendedor. Outras situações podem ser menos claras. Por exemplo, cada um dos seguintes indivíduos e empresas pode precisar registrar-se como um revendedor, dependendo de uma série de fatores: uma pessoa que se mantém como se estivesse disposto a comprar e vender um determinado título em uma base contínua uma pessoa que dirige um Correspondente de acordos de recompra ou uma pessoa que emite ou origina títulos que ele também compra e vende. Aqui estão algumas das perguntas que você deve fazer para determinar se você está agindo como um revendedor: Você anunciar ou de outra forma informar os outros que você está no negócio de compra e venda de títulos Você faz negócios com o público (varejo ou institucional ) Você faz um mercado ou cotação de preços para compras e vendas de um ou mais títulos Você participa de um grupo de quot, ou de outra forma subscreve títulos Você presta serviços a investidores, como manipulação de dinheiro e títulos, Ou dando conselhos de investimento Você escreve contratos de derivativos que são títulos Uma resposta quotyesquot para qualquer uma dessas perguntas indica que você pode precisar se registrar como um revendedor. C. O que fazer se você acha que pode ser um corretor ou um revendedor Se você está fazendo ou pode fazer alguma das atividades de um corretor ou revendedor, você deve descobrir se você precisa se registrar. As informações sobre o processo de registro do corretor são fornecidas abaixo. Se você não tiver certeza, talvez queira revisar as interpretações da SEC, consultar um advogado particular ou pedir conselhos à Divisão de Negociação e Mercados da SEC39, ligando para (202) 551-5777 ou enviando um e-mail para tradingandmarketssec. gov . (Certifique-se de incluir seu número de telefone.) Nota: Se você vai atuar como um quotbrokerquot ou quotdealer, você não deve se envolver em negócios de valores mobiliários até que você esteja devidamente registrado. Se você já está envolvido no negócio e ainda não estão registrados, você deve cessar todas as atividades até que você esteja devidamente registrado. Para mais informações, consulte a Parte II. D e a Parte III, abaixo. D. Corretores e Distribuidores Geralmente Deve Registrar-se na Seção O Artigo 15 (a) (1) da Lei geralmente torna ilegal para qualquer corretor ou negociante usar os correios (ou qualquer outro meio de comércio interestadual, como o telefone, fac-símiles , Ou a Internet) para efetuar quaisquer transações ou induzir ou tentar induzir a compra ou venda de qualquer garantia, a menos que esse corretor ou negociante esteja registrado na Comissão de acordo com a Seção 15 (b) da Lei. Há algumas exceções a esta regra geral que discutimos abaixo. Além disso, discutimos os requisitos especiais de registro que se aplicam aos corretores de títulos públicos e municipais, incluindo os acordos de recompra, abaixo. 1. QuotasAssociadas de um Corretor-Distribuidor Nós chamamos os indivíduos que trabalham para um corretor-negociante registrado quotassociated persons. quot Isto é o caso se tais indivíduos são empregados, contratantes independentes, ou estão trabalhando de outra maneira com um corretor-negociante. Embora as pessoas associadas geralmente não tenham que se registrar separadamente com a SEC, elas devem ser devidamente supervisionadas por um corretor-corretor atualmente registrado. Eles também podem ter que registrar-se com as organizações de auto-regulação de que seu empregador é um membro mdash, por exemplo, a Financial Industry Regulatory Authority, Inc. (exFINRAquot) (f / k / a da Associação Nacional de Securities Dealers, Inc. QuotNASDquot)) ou uma bolsa nacional de valores mobiliários. Na medida em que as pessoas associadas exerçam actividades de valores mobiliários fora da supervisão do seu corretor, estas teriam de se registar separadamente como corretoras. A Parte III, abaixo, fornece uma discussão sobre como se registrar como corretora. Não fazemos distinção entre empregados e outras pessoas associadas para fins de lei de valores mobiliários. Os corretores devem supervisionar as atividades de valores mobiliários de seus funcionários, independentemente de serem considerados como empregados ou como "contratados independentes", conforme definido pela legislação estadual. Vejo . Por exemplo, Em matéria de William V. Giordano. Securities Exchange Act, Lançamento No. 36742 (19 de janeiro de 1996). A lei também não permite que entidades não registradas recebam receitas de comissão em nome de um representante registrado. Por exemplo, as pessoas associadas não podem configurar uma entidade separada para receber verificações de comissão. Uma entidade não registrada que receba receita de comissão nessa situação deve se registrar como corretora. Vejo . Por exemplo, Wolff Juall Investments, LLC (17 de maio de 2005). Sob certas circunstâncias, entidades não registradas podem se envolver em serviços de administração de folha de pagamento envolvendo corretores. Vejo . Por exemplo, letra re: ADP TotalSource, Inc. (4 de dezembro de 2007). Nessas circunstâncias, o empregador do corretor geralmente contrata e supervisiona todos os aspectos do trabalho dos empregados e usa o administrador de folha de pagamento e benefícios apenas como um meio para centralizar os serviços de pessoal. 2. Agentes de corretores intra-estaduais Um corretor-negociante que conduz todos os seus negócios em um estado não tem que se registrar com a SEC. (A inscrição estatal é outra questão, veja a Parte III abaixo.) A exceção prevista para a atividade intra-estatal de corretagem é muito estreita. Para se qualificar, todos os aspectos de todas as transações devem ser feitos dentro das fronteiras de um estado. Isto significa que, sem o registo SEC, um corretor não pode participar em qualquer transação executada em uma bolsa de valores nacional. Um corretor-negociante que satisfaça de outra maneira os requisitos da isenção do corretor-negociante dentro de um estado não cessaria qualificar para a isenção do corretor-negociante dentro do estado unicamente porque tem um Web site que possa ser visto por pessoas de fora do estado, contanto que o Corretor-negociante toma medidas razoavelmente projetadas para garantir que seus negócios permanecem exclusivamente intra-estadual. Essas medidas podem incluir o uso de isenções de responsabilidade que indicam claramente que o negócio de corretores é exclusivamente intra-estatal e que o corretor-negociante só pode atuar por ou com, e prestar serviços de corretor para uma pessoa em seu estado, Corretor-negociante não fornece serviços de corretor-negociante a pessoas que indicam que são, ou que o corretor-negociante tem razões para acreditar que não estão dentro do estado de residência dos corretores. Estas medidas não se destinam a ser exclusivas. Um corretor pode adotar outras medidas razoavelmente projetadas para assegurar que não fornece serviços de corretor para pessoas que não estejam no mesmo estado que o corretor. No entanto, uma empresa de intermediários não seria exclusivamente intra-estatal se vendeu títulos ou prestou quaisquer outros serviços de corretagem para uma pessoa que indica que é, ou que o corretor-negociante tem razões para acreditar que é, não dentro do estado corretor-revendedores De residência. Para obter informações adicionais sobre o uso da Internet por corretores intra-estaduais, consulte sec. gov/rules/final/2016/33-10238.pdf. Uma palavra sobre títulos municipais e governamentais. Não há exceção intra-estadual de registro para corretores de valores municipais ou corretores e negociantes de títulos do governo. 3. Agentes corretores que limitam seu negócio a títulos excluídos e isentos Um corretor que negoceia negócios apenas em papel comercial, aceites bancários e notas comerciais não precisa se registrar com a SEC sob a Seção 15 (b) ou qualquer outra seção Da Lei. Por outro lado, as pessoas que realizam negócios apenas em determinados títulos cotados, tal como definido na Secção 3 (a) (12) da Lei, não têm de se registar ao abrigo da Secção 15 (b), mas podem ter de se registar sob outras disposições Da Lei. Por exemplo, alguns corretores de valores mobiliários do governo, que são valores mobiliários cotados, devem registrar-se como corretores de valores mobiliários do governo ou negociadores de acordo com a Seção 15C da Lei, conforme descrito abaixo na Parte II. E. (Ou ofertas de Regulamentação D) Um título vendido em uma transação que está isenta de registro sob a Lei de Valores Mobiliários de 1933 (a Lei de 1933) não é necessariamente uma garantia de cotização sob o título O Exchange Act. Por exemplo, uma pessoa que vende títulos que estão isentos de registro nos termos da Regra D da Lei de 1933 deve, no entanto, se registrar como corretora. Em outras palavras, agentes de colocação não estão isentos do registro de corretor. 5. Emissor (s) Exoneração (s) e Pessoas Associadas dos Emissores (Regra 3a4-1) Os emissores geralmente não são quotbrokersquot porque eles vendem títulos para suas próprias contas e não para as contas de outros. Além disso, emitentes geralmente não são quotdealersquot porque eles não comprar e vender seus títulos para suas próprias contas como parte de um negócio regular. Entretanto, os emissores cujas atividades vão além da venda de seus próprios valores precisam considerar se eles precisam se registrar como corretores. Isso inclui emissores que adquirem seus títulos de investidores, bem como emissores que efetivamente operam mercados em seus próprios títulos ou em títulos cujas características ou termos podem mudar ou ser alterados. A denominada isenção do emissor não se aplica ao pessoal de uma empresa que, rotineiramente, se envolve no negócio de efetuar transações de valores mobiliários para a empresa ou empresas relacionadas (como sócios em geral que procuram investidores em parcerias limitadas). Os empregados e outras pessoas relacionadas de um emissor que ajude na venda de seus valores mobiliários podem ser quotbrokers, especialmente se eles são pagos por vender esses títulos e têm poucas outras funções. Exchange Act A Regra 3a4-1 prevê que uma pessoa associada (ou empregado) de um emissor que participe da venda dos títulos da emissora não teria que se registrar como corretora se essa pessoa, no momento da participação: (1) Não está sujeito a uma desqualificação quotstatutory, tal como definido na Secção 3 (a) (39) da Lei (2) não é compensado pelo pagamento de comissões ou outra remuneração baseada directa ou indirectamente em transacções de valores mobiliários (3) não é um associado Pessoa de um corretor ou negociante e (4) limita suas atividades de vendas conforme estabelecido na regra. Alguns emitentes oferecem programas de reinvestimento de dividendos e de compra de ações. Sob certas condições, um emissor pode comprar e vender seus próprios valores através de um reinvestimento de dividendos ou programa de compra de ações sem se registrar como corretora. Essas condições, relativas à solicitação, taxas e despesas e manuseio de fundos e valores mobiliários de participantes, são explicadas na Lei de Valores Mobiliários nº 35041 (1 ° de dezembro de 1994), 59 FR 63393 (quot1994 STA Letterquot). Embora o Regulamento M 2 substituiu a Regra 10b-6 e substituiu a Carta STA de 1994, as posições de pessoal tomadas nesta carta relativas à aplicação da Secção 15 (a) do Exchange Act permanecem em vigor. Ver 17 CFR 242.102 (c) e Securities Exchange Act nº 38067 (20 de dezembro de 1996), 62 FR 520, 532 n.100 (3 de janeiro de 1997). 6. Exoneração de corretor estrangeiro (Regra 15a-6) A SEC utiliza geralmente uma abordagem territorial na aplicação dos requisitos de registo às operações internacionais dos corretores. De acordo com essa abordagem, todos os corretores que operam fisicamente nos Estados Unidos e que induzam ou tentam induzir transações de valores mobiliários devem se registrar na SEC, mesmo que suas atividades sejam direcionadas apenas a investidores estrangeiros fora dos Estados Unidos. Além disso, corretores estrangeiros que, de fora dos Estados Unidos, induzam ou tentam induzir transações de valores mobiliários por qualquer pessoa nos Estados Unidos, ou que usam os meios ou instrumentos do comércio interestadual dos Estados Unidos para esse fim, também Deve registrar. Isso inclui o uso da Internet para oferecer títulos, solicitar transações de valores mobiliários ou anunciar serviços de investimento a pessoas dos EUA. Consulte a Lei 39779 (23 de março de 1998) Sec. gov/rules/interp/33-7516.htm da Securities Exchange Act. No entanto, os corretores estrangeiros que limitam suas atividades àqueles permitidos pela Regra 15a-6 da Lei podem estar isentos de registro de corretor norte-americano. Os corretores estrangeiros que desejam confiar nessa isenção devem revisar a Lei de Valores Mobiliários nº 27017 (em vigor a partir de 15 de agosto de 1989), 54 FR 30013, para determinar se cumprem as condições da Regra 15a-6. Ver também cartas re: Atividades de Valores Mobiliários de Negociantes Estrangeiros Afiliados nos EUA (9 de abril e 28 de abril de 1997). Além disso, em Abril de 2005, o pessoal da Divisão de Regulação dos Mercados deu respostas às perguntas frequentes relativas à Regra 15a-6 em relação ao Regulamento AC. Consulte sec. gov/divisions/marketreg/mregacfaq0803.htmpartb. E. Requisitos Relativos aos Corretores e Negociadores de Títulos Governamentais e Municipais, incluindo Contratos de Recompra Os corretores que limitam sua atividade a títulos governamentais ou municipais requerem registro especializado. Aqueles que limitam a sua actividade a títulos públicos não têm de se registar como corretores de valores de propósito geral de acordo com a Secção 15 (b) da Lei. No entanto, os corretores-corretores de propósito geral que conduzem um negócio de títulos do governo devem anotar esta atividade em seu Formulário BD. (O Formulário BD é discutido abaixo). Todas as empresas que são corretoras ou negociantes de títulos públicos devem cumprir as regras adotadas pelo Secretário do Tesouro, bem como as regras da SEC. As empresas que limitam o seu negócio de títulos e valores mobiliários à compra e venda de valores mobiliários municipais para sua própria conta (corretores de valores mobiliários municipais) devem se registrar como corretoras de uso geral. Se, no entanto, essas entidades forem bancos ou cumprirem os requisitos da isenção intraestatal discutidos na Parte II. D.2. Acima, devem registrar-se como negociantes municipais de valores mobiliários. Os corretores de valores mobiliários municipais (que não sejam bancos) devem se registrar como corretores de uso geral, a menos que se qualifiquem para a exceção intra-estadual. Ver Parte II. D.2 acima. As empresas que executam um livro correspondente de acordos de recompra ou outros empréstimos de ações são considerados negociantes. Como um negociante de quotbook que se mantém a si próprio como disposto a comprar e vender valores mobiliários e, por conseguinte, está envolvido no negócio de compra e venda de títulos, deve registar-se como corretor. F. Regras Especiais Aplicáveis ​​aos Bancos e Instituições Financeiras Similares Nota: Os bancos, instituições financeiras e outras instituições financeiras devem estar cientes de que a Comissão adotou regras que podem afetá-las. Ver Regulamento R, Securities Exchange Act nº 34-56501 (24 de setembro de 2007), 72 FR 56514 (3 de outubro de 2007), sec. gov/rules/final/2007/34-56501.pdf e Securities Exchange Lei nº 34-56502 (24 de setembro de 2007) 72 FR 56562 (3 de outubro de 2007), sec. gov/rules/final/2007/34-56502.pdf. Bancos. Antes da promulgação do quórum Gramm-Leach-Bliley Actquot (em inglês, "GLBAquot") em 1999, os bancos norte-americanos foram excluídos das definições de quotbroker e quotdealerquot sob a lei. O GLBA alterou o Exchange Act, e os bancos agora têm certas exceções direcionadas e isenções do registro de corretores. Actualmente, em resultado da regulamentação da Comissão, os bancos estão a passar por um período de transição para o cumprimento da nova lei. Desde 01 de outubro de 2003, os bancos que compram e vendem títulos devem considerar se eles são quotdealersquot sob as leis de títulos federais. A Divisão de Negociação e Mercados emitiu um guia especial de conformidade para os bancos, intitulado "Guia de Conformidade de Bancos sobre as Exceções e Regras Estatutárias dos Comerciantes", que está disponível no site da SEC39 em: sec. gov/divisions/marketreg/bankdealerguide. htm. A actividade de corretagem bancária é abordada no Regulamento R, que foi adoptado conjuntamente pela Comissão e pelo Conselho de Governadores do Sistema da Reserva Federal. Veja a Lei de Ações nº 56501 (24 de setembro de 2007) (que pode ser encontrada em sec. gov/rules/final/2007/34-56501.pdf). As excepções e isenções bancárias só se aplicam aos bancos, e não a entidades relacionadas. É importante ressaltar que as exceções aplicáveis ​​aos bancos nos termos do Exchange Act, conforme alterado pelo GLBA, não são aplicáveis ​​a outras entidades, incluindo subsidiárias e afiliadas bancárias, que não são bancos. Como tal, filiais e afiliadas de bancos que se envolvem em atividades de corretor-revendedor são obrigados a se registrar como corretores de acordo com a Lei. Além disso, os bancos que atuam como negociantes de valores mobiliários municipais ou como corretores ou negociantes de valores mobiliários do governo continuam a ser obrigados a se registrar sob a Lei. Thrifts. Por estatuto, as caixas de poupança (as associações de poupança) têm o mesmo estatuto que os bancos e podem recorrer às mesmas exceções e isenções específicas do registro de corretores como bancos. Como acontece com os bancos, é importante ressaltar que as exceções e isenções aplicáveis ​​às poupanças não são aplicáveis ​​a outras entidades, incluindo subsidiárias e controladas, Afiliadas que não são poupanças. Como tal, as subsidiárias e afiliadas de poupanças que se envolvem em atividades de corretor-comerciante são obrigados a se registrar como corretores de acordo com a Lei. Cooperativas de Crédito e Instituição Financeira. As exceções e isenções aplicáveis ​​aos bancos nos termos da Exchange Act não se aplicam a outros tipos de instituições financeiras, como cooperativas de crédito. A equipe da SEC, no entanto, permitiu que certas instituições financeiras, como cooperativas de crédito, disponibilizassem títulos a seus clientes sem se registrarem como corretores. Isso é feito por meio de acordos de rede, onde um corretor afiliado ou de terceiros fornece serviços de corretagem para os clientes da instituição financeira, de acordo com as condições estabelecidas nas cartas de não-ação e na Regra 2350 da NASD. As comissões geradas pelos seus clientes referidos, sob certas condições. A instituição financeira envolvida nessas redes deve estar em estrita conformidade com a legislação aplicável e com a orientação do pessoal da Comissão. Vejo . Por exemplo, a carta re: Chubb Securities Corporation (24 de novembro de 1993) e NASD Rule 2350 (aplicável aos corretores que entram em acordos de rede com bancos, cooperativas de crédito e cooperativas de crédito). G. Agência de Seguros Networking A equipe da SEC tem permitido agências de seguros para fazer produtos de seguros que também são títulos (como anuidades variáveis) disponíveis para seus clientes sem se registrar como corretores em determinadas condições. Isso novamente é feito por meio de acordos de rede, onde um corretor afiliado ou de terceiros fornece serviços de corretagem para os clientes da agência de seguros, de acordo com as condições estabelecidas em cartas de não-ação. Esses arranjos são projetados para enfrentar as dificuldades de dupla estatal e leis federais aplicáveis ​​à venda destes produtos. Através de arranjos de rede, agências de seguros podem compartilhar nas comissões geradas pelos seus clientes referidos em determinadas condições. As agências de seguros envolvidas nessas redes devem estar em estrita conformidade com a legislação aplicável e com a orientação do pessoal da Comissão. As companhias de seguros devem consultar a carta re: First of America Brokerage Services, Inc. (28 de setembro de 1995). Aqueles interessados ​​em estruturar tal arranjo devem contatar o advogado confidencial ou o pessoal da SEC para a informação mais adicional. Notavelmente, os arranjos de rede de seguros são limitados a produtos de seguros que também são títulos. Não abrangem as vendas de fundos mútuos e outros títulos que não apresentam as mesmas dificuldades regulatórias. Veja a carta re: Lincoln Financial Advisors Corp. (20 de fevereiro de 1998). H. Valores Imobiliários e Corretores / Agentes Imobiliários A oferta de imóveis como tal, sem quaisquer acordos de garantia com o vendedor ou outros, não envolve a oferta de um título. Quando o imóvel é oferecido em conjunto com determinados serviços, no entanto, pode constituir um contrato de investimento e, portanto, um título. Veja em geral. Securities Act Release No. 5347 (4 de janeiro de 1973) (fornecendo diretrizes sobre a aplicabilidade das leis federais de valores mobiliários a ofertas e vendas de condomínios ou unidades em um empreendimento imobiliário). Não há nenhuma exceção geral dos requisitos de registro do corretor para os corretores imobiliários licenciados ou agentes que se envolvem no negócio de efetuar transações em títulos imobiliários. No passado, o pessoal da Divisão concedeu isenção de ação dos requisitos de registro ao pessoal imobiliário licenciado que se envolve em atividades limitadas com relação à venda de unidades de condomínio, juntamente com uma oferta ou acordo para executar ou arranjar certos serviços de aluguel ou outros Para o comprador. The relief provided in these letters is limited solely to their facts and should not be relied upon for activities relating to sales of other types of real estate securities, including tenants-in-common interests in real property. See generally . NASD Notice to Members 05-18, finra. org/sites/default/files/NoticeDocument/p013455.pdf (addressing tenants-in-common interests in real property). I. Broker-Dealer Relationships with Affinity Groups Broker-dealers may enter into arrangements to offer services to members of certain non-profit groups, including civic organizations, charities, and educational institutions that rely upon private donations. These arrangements are subject to certain conditions to ensure that the organizations, or quotaffinity groups, quot do not develop a salesman39s stake with respect to the sale of securities. See . for example, letter re: Attkisson, Carter amp Akers (June 23, 1998). III. HOW TO REGISTER AS A BROKER-DEALER A broker-dealer may not begin business until: it has properly filed Form BD, and the SEC has granted its registration it has become a member of an SRO it has become a member of SIPC, the Securities Investor Protection Corporation it complies with all applicable state requirements and its quotassociated personsquot have satisfied applicable qualification requirements. A. Form BD If a broker-dealer does not qualify for any of the exceptions or exemptions outlined in the sections above, it must register with the Commission under Section 15(b) of the Act. Broker-dealers register by filing an application on Form BD, which you may obtain from the SEC39s webpage at sec. gov/about/forms/formbd. pdf or through the SEC39s Publications Office at (202) 551-4040. You also use Form BD to: apply for membership in an SRO, such as FINRA or a registered national securities exchange give notice that you conduct government securities activities or apply for broker-dealer registration with each state in which you plan to do business. Form BD asks questions about the background of the broker-dealer and its principals, controlling persons, and employees. The broker-dealer must meet the statutory requirements to engage in a business that involves high professional standards, and quite often includes the more rigorous responsibilities of a fiduciary. To apply for registration, you must file one executed copy of Form BD through the Central Registration Depository (quotCRDquot), which is operated by FINRA. (The only exception is for banks registering as municipal securities dealers, which file Form MSD directly with the SEC and with their appropriate banking regulator.) Form BD contains additional filing instructions. The SEC does not charge a filing fee, but the SROs and the states may. Applicants that reside outside the U. S. must also appoint the SEC as agent for service of process using a standard form. Incomplete applications are not considered quotfiledquot and will be returned to the applicant for completion and re-submission. Within 45 days of filing a completed application, the SEC will either grant registration or begin proceedings to determine whether it should deny registration. An SEC registration may be granted with the condition that SRO membership must be obtained. The SROs have independent membership application procedures and are not required to act within 45 days of the filing of a completed application. In addition, state registrations may be required. A broker-dealer must comply with relevant state law as well as federal law and applicable SRO rules. Timeframes for registration with individual states may differ from the federal and SRO timeframes. As such, when deciding to register as a broker-dealer, it is important to plan for the time required for processing Federal, state, and SRO registration or membership applications. Duty to update Form BD. A registered broker-dealer must keep its Form BD current. Thus, it must promptly update its Form BD by filing amendments whenever the information on file becomes inaccurate or incomplete for any reason. Prohibited Broker-Dealer Names. Title 18, Section 709 of the United States Code makes it a criminal offense to use the words quotNational, quot quotFederal, quot quotUnited States, quot quotReserve, quot or quotDeposit Insurancequot in the name of a person or organization in the brokerage business, unless otherwise allowed by federal law. Further, a broker-dealer name that is otherwise materially misleading would become subject to scrutiny under Exchange Act Section 10(b), and Rule 10b-5 thereunder, the general antifraud rules, and any other applicable provisions. B. SRO Membership (Section 15(b)(8) and Rule 15b9-1) Before it begins doing business, a broker-dealer must become a member of an SRO. SROs assist the SEC in regulating the activities of broker-dealers. FINRA and the national securities exchanges are all SROs. If a broker-dealer restricts its transactions to the national securities exchanges of which it is a member and meets certain other conditions, it may be required only to be a member of those exchanges. If a broker-dealer effects securities transactions other than on a national securities exchange of which it is a member, however, including any over-the-counter business, it must become a member of FINRA, unless it qualifies for the exemption in Rule 15b9-1. FINRA39s webpage at finra. org provides detailed information on the FINRA membership process. You may also wish to consult the web pages of the individual exchanges for additional information. Firms that engage in transactions in municipal securities must also comply with the rules of the Municipal Securities Rulemaking Board, or MSRB. The MSRB is an SRO that makes rules governing transactions in municipal securities, but, unlike other SROs, it does not enforce compliance with its rules. Compliance with MSRB rules is monitored and enforced by FINRA and the SEC (in the case of broker-dealers), and the Federal bank regulators and the SEC (in the case of banks). You may wish to consult the MSRB39s website at msrb. org for additional information, or you can call the MSRB at (703) 797-6600. C. SIPC Membership Every registered broker-dealer must be a member of the Securities Investor Protection Corporation, or SIPC, unless its principal business is conducted outside of the United States or consists exclusively of the sale or distribution of investment company shares, variable annuities, or insurance. Each SIPC member must pay an annual fee to SIPC. SIPC insures that its members39 customers receive back their cash and securities in the event of a member39s liquidation, up to 500,000 per customer for cash and securities. (Claims for cash are limited to 100,000.) For further information, contact SIPC, 805 15th St. NW, Suite 800, Washington, DC 20005. Telephone: (202) 371-8300, fax: (202) 371-6728, or visit SIPC39s website at sipc. org . D. State Requirements Every state has its own requirements for a person conducting business as a broker-dealer within that state. Each state39s securities regulator can provide you with information about that state39s requirements. You can obtain contact information for these regulators from the North American Securities Administrators Association, Inc. (NASAA), 750 First Street, NE, Suite 1140, Washington, DC 20002. Telephone: (202) 737-0900, or visit NASAA39s website at nasaa. org . E. Associated Persons (Section 3(a)(18) Rule 15b7-1) The Act defines an quotassociated personquot of a broker-dealer as any partner, officer, director, branch manager, or employee of the broker-dealer, any person performing similar functions, or any person controlling, controlled by, or under common control with, the broker-dealer. A broker-dealer must file a Form U-4 with the applicable SRO for each associated person who will effect transactions in securities when that person is hired or otherwise becomes associated. Form U-4 is used to register individuals and to record these individuals39 prior employment and disciplinary history. An associated person who effects or is involved in effecting securities transactions also must meet qualification requirements. These include passing an SRO securities qualification examination. Many individuals take the comprehensive quotSeries 7quot exam. If individuals engage only in activities involving sales of particular types of securities, such as municipal securities, direct participation programs (limited partnerships) or mutual funds, they may wish to take a specialized examination focused on that type of security, instead of the general securities examination. There is also a special exam for assistant representatives, whose activities are limited to accepting unsolicited customer orders for execution by the firm. Supervisory personnel, and those who engage in specialized activities such as options trading, must take additional exams that cover those areas. These examinations require the Series 7 exam as a prerequisite. You can obtain copies of Form U-4, as well as information on securities qualification examinations, from an SRO. FINRA39s website at finra. org contains detailed information and guidance for individuals who wish to obtain a series license through FINRA. Also note that individual states have their own licensing and registration requirements, so you should consult with the applicable state securities regulators for further information. Note: If you hold a series license, you must be properly associated with a registered broker-dealer to effect securities transactions. It is not sufficient merely to hold a series license when engaging in securities business. If you hold a series license and wish to start an independent securities business, or otherwise wish to effect securities transactions outside of an quotassociated personquot relationship, you would first need to register as a broker-dealer. F. Successor Broker-Dealer Registration (Rules 15b1-3, 15Ba2-4, and 15Ca2-3) A successor broker-dealer assumes substantially all of the assets and liabilities, and continues the business, of a registered predecessor broker-dealer. A successor broker-dealer must file a new Form BD (or, in special instances, amend the predecessor broker-dealer39s Form BD) within 30 days after such succession. The filing should indicate that the applicant is a successor. See Securities Exchange Act Release No. 31661 (December 28, 1992), 58 FR 7, which is available on the SEC39s website at: sec. gov/rules/interp/1992/34-31661.pdf. See also, the instructions to Form BD . G. Withdrawal from Registration (Rule 15b6-1) Cancellation of Registration When a registered broker-dealer stops doing business, it must file a Form BDW (sec. gov/about/forms/formbdw. pdf ) to withdraw its registration with the SEC and with the states and SROs of which it is a member. This form requires the broker-dealer to disclose the amount of any funds or securities it owes customers, and whether it is the subject of any proceedings, unsatisfied judgments, liens, or customer claims. These disclosures help to ensure that a broker-dealer39s business is concluded in an orderly manner and that customers39 funds and securities are protected. In most cases, a broker-dealer must also file a final FOCUS report. Form BDW may also be used by a broker-dealer to withdraw from membership with particular SROs, or to withdraw from registration with particular states, without withdrawing all of its registrations and memberships. Form BDW is not considered quotfiledquot unless it is deemed complete by the SEC and the SRO that reviews the filing. The SEC may also cancel a broker-dealer39s registration if it finds that the firm is no longer in existence or has ceased doing business as a broker-dealer. IV. SECURITY FUTURES Security futures, which are contracts of sale for future delivery of a single security or a narrow-based security index, are regulated as both securities by the SEC and as futures by the Commodity Futures Trading Commission (quotCFTCquot). As a result, firms that conduct business in security futures must be registered with both the SEC and the CFTC. Federal law permits firms already registered with either the SEC or the CFTC to register with the other agency, for the limited purpose of trading security futures, by filing a notice. Specifically, firms registered as general purpose broker-dealers under Section 15(b) of the Act may quotnoticequot register with the CFTC. Likewise, futures commission merchants and introducing brokers registered with the CFTC may notice register with the SEC. (Section 15(b)(12) of the Act provides a limited exception to this notice registration requirement for certain natural persons who are members of security futures exchanges). However, futures commission merchants or introducing brokers that conduct a business in securities other than security futures must be registered as general-purpose broker-dealers. For more information on this topic, See Exchange Act Release No. 44730 (effective August 27, 2001), 66 FR 45138, and 66 FR 43080 (effective September 17, 2001). V. CONDUCT REGULATION OF BROKER-DEALERS Broker-dealers, like other securities market participants, must comply with the general quotantifraudquot provisions of the federal securities laws. Broker-dealers must also comply with many requirements that are designed to maintain high industry standards. We discuss some of these provisions below. A. Antifraud Provisions (Sections 9(a), 10(b), and 15(c)(1) and (2)) The quotantifraudquot provisions prohibit misstatements or misleading omissions of material facts, and fraudulent or manipulative acts and practices, in connection with the purchase or sale of securities. 3 While these provisions are very broad, the Commission has adopted rules, issued interpretations, and brought enforcement actions that define some of the activities we consider manipulative, deceptive, fraudulent, or otherwise unlawful. 4 Broker-dealers must conduct their activities so as to avoid these kinds of practices. 1. Duty of Fair Dealing Broker-dealers owe their customers a duty of fair dealing. This fundamental duty derives from the Act39s antifraud provisions mentioned above. Under the so-called quotshinglequot theory, by virtue of engaging in the brokerage profession ( e. g. . hanging out the broker-dealer39s business sign, or quotshinglequot), a broker-dealer represents to its customers that it will deal fairly with them, consistent with the standards of the profession. Based on this important representation, the SEC, through interpretive statements and enforcement actions, and the courts, through case law, have set forth over time certain duties for broker-dealers. These include the duties to execute orders promptly, disclose certain material information ( i. e. . information the customer would consider important as an investor), charge prices reasonably related to the prevailing market, and fully disclose any conflict of interest. SRO rules also reflect the importance of fair dealing. For example, FINRA members must comply with NASD39s Rules of Fair Practice. These rules generally require broker-dealers to observe high standards of commercial honor and just and equitable principles of trade in conducting their business. The exchanges and the MSRB have similar rules. 2. Suitability Requirements Broker-dealers generally have an obligation to recommend only those specific investments or overall investment strategies that are suitable for their customers. The concept of suitability appears in specific SRO rules such as NASD Rule 2310 and has been interpreted as an obligation under the antifraud provisions of the federal securities laws. Under suitability requirements, a broker-dealer must have an quotadequate and reasonable basisquot for any recommendation that it makes. Reasonable basis suitability, or the reasonable basis test, relates to the particular security or strategy recommended. Therefore, the broker-dealer has an obligation to investigate and obtain adequate information about the security it is recommending. A broker-dealer also has an obligation to determine customer-specific suitability. In particular, a broker-dealer must make recommendations based on a customer39s financial situation, needs, and other security holdings. This requirement has been construed to impose a duty of inquiry on broker-dealers to obtain relevant information from customers relating to their financial situations and to keep such information current. SROs consider recommendations to be unsuitable when they are inconsistent with the customer39s investment objectives. 3. Duty of Best Execution The duty of best execution, which also stems from the Act39s antifraud provisions, requires a broker-dealer to seek to obtain the most favorable terms available under the circumstances for its customer orders. This applies whether the broker-dealer is acting as agent or as principal. The SRO rules also include a duty of best execution. For example, FINRA members must use quotreasonable diligencequot to determine the best market for a security and buy or sell the security in that market, so that the price to the customer is as favorable as possible under prevailing market conditions. 4. Customer Confirmation Rule (Rule 10b-10 and MSRB rule G-15) A broker-dealer must provide its customers, at or before the completion of a transaction, with certain information, including: the date, time, identity, price, and number of shares involved its capacity (agent or principal) and its compensation (for agency trades, compensation includes its commission and whether it receives payment for order flow 5 and for principal trades, mark-up disclosure may be required) the source and amount of any third party remuneration it has received or will receive 6 other information, both general (such as, if the broker-dealer is not a SIPC member) and transaction-specific (such as the yield, in most transactions involving debt securities). A broker-dealer may also be obligated under the antifraud provisions of the Act to disclose additional information to the customer at the time of his or her investment decision. 5. Disclosure of Credit Terms (Rule 10b-16) Broker-dealers must notify customers purchasing securities on credit about the credit terms and the status of their accounts. A broker-dealer must establish procedures for disclosing this information before it extends credit to a customer for the purchase of securities. A broker-dealer must give the customer this information at the time the account is opened, and must also provide credit customers with account statements at least quarterly. 6. Restrictions on Short Sales (Regulation SHO) A quotshort salequot is generally a sale of a security that the seller doesn39t own or for which the seller delivers borrowed shares. Regulation SHO was adopted in 2004 to update short sale regulation in light of numerous market developments since short sale regulation was first adopted in 1938. Compliance with Regulation SHO began on January 3, 2005. Some of the goals of Regulation SHO include: Establishing uniform quotlocatequot and quotclose-outquot requirements in order to address problems associated with failures to deliver, including potentially abusive quotnakedquot short selling. Locate Requirement: Regulation SHO requires a broker-dealer to have reasonable grounds to believe that the security can be borrowed so that it can be delivered on the date delivery is due before effecting a short sale order in any equity security. This quotlocatequot must be made and documented prior to effecting the short sale. Market makers engaged in bona fide market making are exempted from the quotlocatequot requirement. quotClose-outquot Requirement: Regulation SHO imposes additional delivery requirements on broker-dealers for securities in which there are a relatively substantial number of extended delivery failures at a registered clearing agency (quotthreshold securitiesquot). For instance, with limited exception, Regulation SHO requires brokers and dealers that are participants of a registered clearing agency to take action to quotclose-outquot failure-to-deliver positions (quotopen failsquot) in threshold securities that have persisted for 13 consecutive settlement days. Encerramento exige que o corretor ou negociante para comprar títulos de tipo e quantidade. Until the position is closed out, the broker or dealer and any broker or dealer for which it clears transactions (for example, an introducing broker) may not effect further short sales in that threshold security without borrowing or entering into a bona fide agreement to borrow the security (known as the quotpre-borrowingquot requirement). Creating uniform order marking requirements for sales of all equity securities. This means that a broker-dealer must mark orders as quotlongquot or quotshort. quot For further information, please see the adopting release for Regulation SHO, as well as Frequently Asked Questions, Key Points, and other related materials at sec. gov/spotlight/shortsales. htm . 7. Trading During an Offering (Regulation M) Regulation M is designed to protect the integrity of the securities trading market as an independent pricing mechanism by governing the activities of underwriters, issuers, selling security holders, and other participants in connection with a securities offering. These rules are aimed at preventing persons having an interest in an offering from influencing the market price for the offered security in order to facilitate a distribution. The adopting release for Regulation M is available at sec. gov/rules/final/34-38067.txt . Rule 101 of Regulation M generally prohibits underwriters, broker-dealers and other distribution participants from bidding for, purchasing, or attempting to induce any person to bid for or purchase, any security which is the subject of a distribution until the applicable restricted period has ended. An offering39s quotrestricted periodquot begins either one or five business days (depending on the trading volume value of the offered security and the public float value of the issuer) before the day of the offering39s pricing and ends upon completion of the distribution. Rule 101 contains various exceptions that are designed to permit an orderly distribution of securities and limit disruption in the market for the securities being distributed. For example, underwriters can continue to trade in actively-traded securities of larger issuers (securities with an average daily trading volume, or ADTV, value of 1 million or more and whose issuers have a public float value of at least 150 million). In addition, the following activities, among others, may be excepted from Rule 101, if they meet specified conditions: disseminating research reports making unsolicited purchases purchasing a group, or quotbasketquot of 20 or more securities exercising options, warrants, rights, and convertible securities effecting transactions that total less than 2 of the security39s ADTV and effecting transactions in securities sold to quotqualified institutional buyers. quot Rule 102 of Regulation M prohibits issuers, selling security holders, and their affiliated purchasers from bidding for, purchasing, or attempting to induce any person to bid for or purchase, any security which is the subject of a distribution until after the applicable restricted period. Rule 103 of Regulation M governs passive market making by broker-dealers participating in an offering of a Nasdaq security. Rule 104 of Regulation M governs stabilization transactions, syndicate short covering activity, and penalty bids. Rule 105 of Regulation M prevents manipulative short sales prior to pricing an offering by prohibiting the purchase of offering securities if a person sold short the security that is the subject of the offering during the Rule 105 restricted period. The rule contains exceptions for bona fide purchases, separate accounts, and investment companies. For frequently asked questions about Regulation M, see Staff Legal Bulletin No. 9 at sec. gov/interps/legal/mrslb9.htm . 8. Restrictions on Insider Trading The SEC and the courts interpret Section 10(b) and Rule 10b-5 under the Act to bar the use by any person of material non-public information in the purchase or sale of securities, whenever that use violates a duty of trust and confidence owed to a third party. Section 15(f) of the Act specifically requires broker-dealers to have and enforce written policies and procedures reasonably designed to prevent their employees from misusing material non-public information. Because employees in the investment banking operations of broker-dealers frequently have access to material non-public information, firms need to create procedures designed to limit the flow of this information so that their employees cannot use the information in the trading of securities. Broker-dealers can use these information barriers as a defense to a claim of insider trading. Such procedures typically include: training to make employees aware of these restrictions employee trading restrictions physical barriers isolation of certain departments and limitations on investment bank proprietary trading. 7 9. Restrictions on Private Securities Transactions NASD Rule 3040 provides that quotno person associated with a member shall participate in any manner in a private securities transactionquot except in accordance with the provisions of the rule. To the extent that any such transactions are permitted under the rule, prior to participating in any private securities transaction, the associated person must provide written notice to the member firm as described in the rule. If compensation is involved, the member firm must approve or disapprove the proposed transaction, record it in its books and records, and supervise the transaction as if it were executed on behalf of the member firm. Other conditions may also apply. In addition, private securities transactions of an associated person may be subject to an analysis under Exchange Act Section 10(b) and Rule 10b-5, as well as the broker-dealer supervisory provisions of Section 15(f) (described in Part V. A.8, above) and Section 15(b)(4)(E), and other relevant statutory or regulatory provisions. B. Analysts and Regulation AC Regulation AC (or Regulation Analyst Certification) requires brokers, dealers, and persons associated with brokers or dealers that publish, distribute, or circulate research reports to include in those reports a certification that the views expressed in the report accurately reflect the analyst39s personal views. The report must also disclose whether the analyst received compensation for the views expressed in the report. If the analyst has received related compensation, the broker, dealer, or associated person must disclose its amount, source, and purpose. Regulation AC applies to all brokers and dealers, as well as to those persons associated with a broker or dealer that fall within the definition of quotcovered person. quot Regulation AC also requires that broker-dealers keep records of analyst certifications relating to public appearances. In addition to Commission rules, analyst conduct is governed by SRO rules, such as NASD Rule 2711 and NYSE Rule 472. The SRO rules impose restrictions on analyst compensation, personal trading activities, and involvement in investment banking activities. The SRO rules also include disclosure requirements for research reports and public appearances. For further information, including investor guidance, SEC releases, and SRO rules, see sec. gov/divisions/marketreg/securitiesanalysts. htm. In addition, staff responses to frequently asked questions are available at sec. gov/divisions/marketreg/mregacfaq0803.htm . C. Trading by Members of Exchanges, Brokers and Dealers (Section 11(a)) Broker-dealers that are members of national securities exchanges are subject to additional regulations regarding transactions they effect on exchanges. For example, except under certain conditions, they generally cannot effect transactions on exchanges for their own accounts, the accounts of their associated persons, or accounts that they or their associated persons manage. Exceptions from this general rule include transactions by market makers, transactions routed through other members, and transactions that yield to other orders. Exchange members may wish to seek guidance from their exchange regarding these provisions. D. Extending Credit on New Issues Disclosure of Capacity as Broker or Dealer (Section 11(d)) Section 11(d)(1) of the Act generally prohibits a broker-dealer that participates in the distribution of a new issue of securities from extending credit to customers in connection with the new issue during the distribution period and for 30 days thereafter. Sales by a broker-dealer of mutual fund shares and variable insurance product units are deemed to constitute participation in the distribution of a new issue. Therefore, purchase of mutual fund shares or variable product units using credit extended or arranged by the broker-dealer during the distribution period is a violation of Section 11(d)(1). However, Exchange Act Rule 11d1-2 permits a broker-dealer to extend credit to a customer on newly sold mutual fund shares and variable insurance product units after the customer has owned the shares or units for 30 days. Section 11(d)(2) of the Act requires a broker-dealer to disclose in writing, at or before the completion of each transaction with a customer, whether the broker-dealer is acting in the capacity of broker or dealer with regard to the transaction. E. Regulation NMS Regulation NMS addresses four interrelated topics that are designed to modernize the regulatory structure of the U. S. equity markets: (1) order protection, (2) intermarket access, (3) sub-penny pricing, and (4) market data. The quotOrder Protection Rulequot requires trading centers to establish, maintain, and enforce written policies and procedures reasonably designed to prevent the execution of trades at prices inferior to protected quotations displayed by other trading centers, subject to an applicable exception. To be protected, a quotation must be immediately and automatically accessible. The quotAccess Rulequot requires fair and non-discriminatory access to quotations, establishes a limit on access fees to harmonize the pricing of quotations across different trading centers, and requires each national securities exchange and national securities association to adopt, maintain, and enforce written rules that prohibit their members from engaging in a pattern or practice of displaying quotations that lock or cross automated quotations. The quotSub-Penny Rulequot prohibits market participants from accepting, ranking, or displaying orders, quotations, or indications of interest in a pricing increment smaller than a penny, except for orders, quotations, or indications of interest that are priced at less than 1.00 per share. The quotMarket Data Rulesquot update the requirements for consolidating, distributing, and displaying market information. In addition, amendments to the joint industry plans for disseminating market information modify the formulas for allocating plan revenues among the self-regulatory organizations and broaden participation in plan governance. Regulation NMS also updates and streamlines the existing Exchange Act rules governing the national market system previously adopted under Section 11A of the Exchange Act, and consolidates them into a single regulation. F. Order Execution Obligations (Rules 602-604 of Regulation NMS) Broker-dealers that are exchange specialists or Nasdaq market makers must comply with particular rules regarding publishing quotes and handling customer orders. These two types of broker-dealers have special functions in the securities markets, particularly because they trade for their own accounts while also handling orders for customers. These rules, which include the quotQuote Rulequot and the quotLimit Order Display Rule, quot increase the information that is publicly available concerning the prices at which investors may buy and sell exchange-listed and Nasdaq National Market System securities. The Quote Rule requires specialists and market makers to provide quotation information to their self-regulatory organization for dissemination to the public. The quote information that the specialist or market maker provides must reflect the best prices at which he is willing to trade (the lowest price the dealer will accept from a customer to sell the securities and the highest price the dealer will pay a customer to purchase the securities). A specialist or market maker may still trade at better prices in certain private trading systems, called electronic communications networks, or quotECNs, quot without publishing an improved quote. This is true only when the ECN itself publishes the improved prices and makes those prices available to the investing public. Thus, the Quote Rule ensures that the public has access to the best prices at which specialists and market makers are willing to trade even if those prices are in private trading systems. Limit orders are orders to buy or sell securities at a specified price. The Limit Order Display Rule requires that specialists and market makers publicly display certain limit orders they receive from customers. If the limit order is for a price that is better than the specialist39s or market maker39s quote, the specialist or market maker must publicly display it. The rule benefits investors because the publication of trading interest at prices that improve specialists39 and market makers39 quotes present investors with improved pricing opportunities. G. Regulation ATS: Broker-Dealer Trading Systems Regulation ATS (17 CFR 242.300 et seq.) provides a means for broker-dealers to operate automated trading platforms, to collect and execute orders in securities electronically, without registering as a national securities exchange under Section 6 of the Exchange Act or as an exempt exchange pursuant to Section 5 of the Act. For purposes of the regulation, an alternative trading system or ATS is any organization, association, person, group of persons, or system that constitutes, maintains, or provides a marketplace or facilities for bringing together purchasers and sellers of securities or for otherwise performing with respect to securities the functions commonly performed by a stock exchange as defined in Rule 3b-16 under the Exchange Act. See 17 CFR 242.300. Further, for purposes of the regulation, an ATS may not set rules governing the conduct of subscribers (other than with respect to the use of the particular trading system), or discipline subscribers other than by exclusion from trading. To the extent that an ATS or the sponsoring broker-dealer seeks to establish conduct or disciplinary rules, the entity may be required to register as a national securities exchange or obtain a Commission exemption from exchange registration based on limited trading volume. In order to acquire the status of an ATS, a firm must first be registered as a broker-dealer, and it must file an initial operation report with respect to the trading system on Form ATS at least 20 days before commencing operation. The initial operation report must be accurate and kept current. The Commission does not issue approval orders for Form ATS filings however, the Form ATS is not considered filed unless it complies with all applicable requirements under the Regulation. Regulation ATS contains provisions concerning the system39s operations, including: fair access to the trading system fees charged the display of orders and the ability to execute orders system capacity, integrity and security record keeping and reporting and procedures to ensure the confidential treatment of trading information. An ATS must file with the Division of Trading and Markets quarterly reports regarding its operations on Form ATS-R. An ATS must also comply with any applicable SRO rules and with state laws relating to alternative trading systems and relating to the offer or sale of securities or the registration or regulation of persons or entities effecting securities transactions. Finally, an ATS may not use in its name the word quotexchange, quot or terms similar to the word quotexchange, quot such as the term quotstock market. quot See 17 CFR 242.301. For further information on the operation and regulation of alternative trading systems, see the adopting release for Regulation ATS at sec. gov/rules/final/34-40760.txt . H. Penny Stock Rules (Rules 15g-2 through 15g-9, Schedule 15G) Most broker-dealers that effect transactions in quotpenny stocksquot have certain enhanced suitability and disclosure obligations to their customers. 8 A penny stock is generally defined as any equity security other than a security that: (a) is an NMS stock ( See Rule 600(b)(47)) listed on a quotgrandfatheredquot national securities exchange, (b) is an NMS stock listed on a national securities exchange or an automated quotation system sponsored by a registered national securities association (including Nasdaq) that satisfies certain minimum quantitative listing standards, (c) has a transaction price of five dollars or more, (d) is issued by a registered investment company or by the Options Clearing Corporation, (e) is a listed security futures product, or (f) is a security whose issuer has met certain net tangible assets or average revenues ( See Rule 3a51-1). Penny stocks include the equity securities of private companies with no active trading market if they do not qualify for one of the exclusions from the definition of penny stock. Before a broker-dealer that does not qualify for an exemption 9 may effect a solicited transaction in a penny stock for or with the account of a customer it must: (1) provide the customer with a risk disclosure document, as set forth in Schedule 15G, and receive a signed and dated acknowledgement of receipt of that document from the customer ( See Rule 15g-2) (2) approve the customer39s account for transactions in penny stocks, provide the customer with a suitability statement, and receive a signed a dated copy of that statement from the customer and (3) receive the customer39s written agreement to the transaction ( See Rule 15g-9). The broker-dealer also must wait at least two business days after sending the customer the risk disclosure document and the suitability statement before effecting the transaction. In addition, Exchange Act Rules 15g-3 through 15g-6 generally require a broker-dealer to give each penny stock customer: information on market quotations and, where appropriate, offer and bid prices the aggregate amount of any compensation received by the broker-dealer in connection with such transaction the aggregate amount of cash compensation that any associated person of the broker-dealer, who is a natural person and who has communicated with the customer concerning the transaction at or prior to the customerrsquos transaction order, other than a person whose function is solely clerical or ministerial, has received or will receive from any source in connection with the transaction and monthly account statements showing the market value of each penny stock held in the customerrsquos account. I. Privacy of Consumer Financial Information (Regulation S-P) Broker-dealers, including foreign broker-dealers registered with the Commission and unregistered broker-dealers in the United States, must comply with Regulation S-P, ( See 17 CFR Part 248) even if their consumers are non-U. S. persons or if they conduct their activities through non-U. S. offices or branches. Regulation SP generally requires a broker-dealer to provide its customers with initial, annual and revised notices containing specified information about the broker-dealer39s privacy policies and practices. These notices must be clear and conspicuous, and must accurately reflect the broker-dealer39s policies and practices. See 17 CFR 248.4, 248.5, 248.6 and 248.8. Before disclosing nonpublic personal information about a consumer to a nonaffiliated third party, a broker-dealer must first give a consumer an opt-out notice and a reasonable opportunity to opt out of the disclosure. See 17 CFR 248.7 and 248.10. There are exceptions from these notice and opt-out requirements for disclosures to other financial institutions under joint marketing agreements and to certain service providers. See 17 CFR 248.13. There also are exceptions for disclosures made for purposes such as maintaining or servicing accounts, and disclosures made with the consent or at the direction of a consumer, or for purposes such as protecting against fraud, reporting to consumer reporting agencies, and providing information to law enforcement agencies. See 17 CFR 248.14 and 248.15. Regulation SP also imposes limits on the re-disclosure and re-use of information, and on sharing account number information with nonaffiliated third parties for use in telemarketing, direct mail marketing and email marketing. See 17 CFR 248.11 and 248.12. In addition, it includes a safeguards rule that requires a broker-dealer to adopt written policies and procedures for administrative, technical, and physical safeguards to protect customer records and information. See 17 CFR 248.30(a). Further, it includes a disposal rule that requires a broker-dealer (other than a broker-dealer registered by notice with the Commission to engage solely in transactions in securities futures) that maintains or possesses consumer report information for a business purpose to take reasonable measures to protect against unauthorized access to or use of the information in connection with its disposal. See 17 CFR 248.30(b). Recently proposed amendments which would further strengthen the privacy protections under Regulation S-P are available at sec. gov/rules/proposed/2008/34-57427.pdf . J. Investment Adviser Registration Broker-dealers offering certain types of accounts and services may also be subject to regulation under the Investment Advisers Act. 10 (An investment adviser is defined as a person who receives compensation for providing advice about securities as part of a regular business.) ( See Section 202(a)(11) of the Investment Advisers Act .) In general, a broker-dealer whose performance of advisory services is quotsolely incidentalquot to the conduct of its business as a broker-dealer and that receives no quotspecial compensationquot is excepted from the definition of investment adviser. Thus, for example, a broker-dealer that provides advice and offers fee-based accounts (i. e. accounts that charge an asset-based or fixed fee rather than a commission, mark-up, or mark-down) must treat those accounts as advisory because an asset-based fee is considered quotspecial compensation. quot Also, under a recently proposed rule, a broker-dealer would be required to treat (1) each account over which it exercises investment discretion as an advisory account, unless the investment discretion is granted by a customer on a temporary or limited basis and (2) an account as advisory if the broker-dealer charges a separate fee for, or separately contracts to provide, advisory services. ( See sec. gov/rules/proposed/2007/ia-2652.pdf .) Finally, under the same proposed rule, a broker-dealer that is registered under the Exchange Act and registered under the Investment Advisers Act would be an investment adviser solely with respect to those accounts for which it provides services that subject the broker-dealer to the Investment Advisers Act. VI. ARBITRATION Pursuant to the rules of self-regulatory organizations, broker-dealers are required to arbitrate disputes with their customers, if the customer chooses to arbitrate. See e. g. . NASD Code of Arbitration Procedure for Customer Disputes, Rule 12200 American Stock Exchange, Rule 600 and Chicago Board of Options Exchange, Rule 18.1. VII. FINANCIAL RESPONSIBILITY OF BROKER-DEALERS Broker-dealers must meet certain financial responsibility requirements, including: maintaining minimum amounts of liquid assets, or net capital taking certain steps to safeguard the customer funds and securities and making and preserving accurate books and records. A. Net Capital Rule (Rule 15c3-1) The purpose of this rule is to require a broker-dealer to have at all times enough liquid assets to promptly satisfy the claims of customers if the broker-dealer goes out of business. Under this rule, broker-dealers must maintain minimum net capital levels based upon the type of securities activities they conduct and based on certain financial ratios. For example, broker-dealers that clear and carry customer accounts generally must maintain net capital equal to the greater of 250,000 or two percent of aggregate debit items. Broker-dealers that do not clear and carry customer accounts can operate with lower levels of net capital. B. Use of Customer Balances (Rule 15c3-2) Broker-dealers that use customers39 free credit balances in their business must establish procedures to provide specified information to those customers, including: the amount due to those customers the fact that such funds are not segregated and may be used by the broker-dealer in its business and the fact that such funds are payable on demand of the customer. C. Customer Protection Rule (Rule 15c3-3) This rule protects customer funds and securities held by broker-dealers. Under the rule, a broker-dealer must have possession or control of all fully-paid or excess margin securities held for the account of customers, and determine daily that it is in compliance with this requirement. The broker-dealer must also make periodic computations to determine how much money it is holding that is either customer money or obtained from the use of customer securities. If this amount exceeds the amount that it is owed by customers or by other broker-dealers relating to customer transactions, the broker-dealer must deposit the excess into a special reserve bank account for the exclusive benefit of customers. This rule thus prevents a broker-dealer from using customer funds to finance its business. D. Required Books, Records, and Reports (Rules 17a-3, 17a-4, 17a-5, 17a-11) 11 Broker-dealers must make and keep current books and records detailing, among other things, securities transactions, money balances, and securities positions. They also must keep records for required periods and furnish copies of those records to the SEC on request. These records include e-mail. Broker-dealers also must file with the SEC periodic reports, including quarterly and annual financial statements. The annual statements generally must be certified by an independent public accountant. In addition, broker-dealers must notify the SEC and the appropriate SRO 12 regarding net capital, recordkeeping, and other operational problems, and in some cases file reports regarding those problems, within certain time periods. This gives us and the SROs early warning of these problems. E. Risk Assessment Requirements (Rules 17h-1T and 17h-2T) Certain broker-dealers must maintain and preserve certain information regarding those affiliates, subsidiaries and holding companies whose business activities are reasonably likely to have a material impact on their own financial and operating condition (including the broker-dealer39s net capital, liquidity, or ability to conduct or finance operations). Broker-dealers must also file a quarterly summary of this information. This information is designed to permit the SEC to assess the impact these entities may have on the broker-dealer. VIII. OTHER REQUIREMENTS In addition to the provisions discussed above, broker-dealers must comply with other requirements. These include: submitting to Commission and SRO examinations participating in the lost and stolen securities program complying with the fingerprinting requirement maintaining and reporting information regarding their affiliates following certain guidelines when using electronic media to deliver information and maintaining an anti-money laundering program. A. Examinations and Inspections (Rules 15b2-2 and 17d-1) Broker-dealers are subject to examination by the SEC and the SROs. The appropriate SRO generally inspects newly-registered broker-dealers for compliance with applicable financial responsibility rules within six months of registration, and for compliance with all other regulatory requirements within twelve months of registration. A broker-dealer must permit the SEC to inspect its books and records at any reasonable time. B. Lost and Stolen Securities Program (Rule 17f-1) In general, all broker-dealers must register in the lost and stolen securities program. The limited exceptions include broker-dealers that effect securities transactions exclusively on the floor of a national securities exchange solely for other exchange members and do not receive or hold customer securities, and broker-dealers whose business does not involve handling securities certificates. Broker-dealers must report losses, thefts, and instances of counterfeiting of securities certificates on Form X-17F-1A, and, in some cases, broker-dealers must make inquiries regarding securities certificates coming into their possession. Broker-dealers must file these reports and inquiries with the Securities Information Center (SIC), which operates the program for the SEC. A registration form can be obtained from Securities Information Center, P. O. Box 55151, Boston, MA 02205-5151. For registration and additional information, see the SIC39s website at secic . C. Fingerprinting Requirement (Rule 17f-2) Generally, every partner, officer, director, or employee of a broker-dealer must be fingerprinted and submit his or her fingerprints to the U. S. Attorney General. This requirement does not apply, however, to broker-dealers that sell only certain securities that are not ordinarily evidenced by certificates (such as mutual funds and variable annuities) or to persons who do not sell securities, have access to securities, money or original books and records, and do not supervise persons engaged in such activities. A broker-dealer claiming an exemption must comply with the notice requirements of Rule 17f-2. Broker-dealers may obtain fingerprint cards from their SRO and should submit completed fingerprint cards to the SRO for forwarding to the FBI on behalf of the Attorney General. D. Use of Electronic Media by Broker-Dealers The Commission has issued two interpretive releases discussing the issues that broker-dealers should consider in using electronic media for delivering information to customers. These issues include the following: Will the customer have notice of and access to the communication Will there be evidence of delivery Did the broker-dealer take reasonable precautions to ensure the integrity, confidentiality, and security of any personal financial information See Securities Exchange Act Release No. 37182 (May 15, 1996), 61 FR 24644. See also . Securities Exchange Act Release No. 39779 (March 23, 1998), 63 FR 14806 (sec. gov/rules/interp/33-7516.htm ). E. Electronic Signatures (E-SIGN) Broker-dealers should also consider the impact, if any, that the Electronic Signatures in Global and National Commerce Act (commonly known as E-SIGN), Pub. L. No. 106-229, 114 Stat. 464 (2000) 15 U. S.C. sect7001, has on their ability to deliver information to customers electronically. F. Anti-Money Laundering Program Broker-dealers have broad obligations under the Bank Secrecy Act (quotBSAquot) 13 to guard against money laundering and terrorist financing through their firms. The BSA, its implementing regulations, and Rule 17a-8 under the Exchange Act require broker-dealers to file reports or retain records relating to suspicious transactions, customer identity, large cash transactions, cross-border currency movement, foreign bank accounts and wire transfers, among other things. The BSA, as amended by the USA PATRIOT Act, as well as SRO rules (e. g. NASD Rule 3011 and NYSE Rule 445), also requires all broker-dealers to have anti-money laundering compliance programs in place. Firms must develop and implement a written anti-money laundering compliance program, approved in writing by a member of senior management, which is reasonably designed to achieve and monitor the member39s ongoing compliance with the requirements of the BSA and its implementing regulations. Under this obligation, firms must: establish and implement policies and procedures that can be reasonably expected to detect and cause the reporting of suspicious transactions establish and implement policies, procedures, and internal controls reasonably designed to achieve compliance with the BSA and implementing regulations provide for independent testing for compliance, to be conducted by member personnel or by a qualified outside party designate and identify to the SROs an individual or individuals responsible for implementing and monitoring the day-to-day operations and internal controls of the program and provide prompt notification regarding any change in such designation(s) and provide ongoing training for appropriate personnel. For a compilation of key anti-money laundering laws, rules and guidance applicable to broker-dealers, see Anti-Money Laundering Source Tool sec. gov/about/offices/ocie/amlsourcetool. htm see also, FINRA Anti-Money Laundering Issue Center finra. org/RulesRegulation/IssueCenter/Anti-MoneyLaundering/index. htm. In addition, the Financial Crimes Enforcement Network (quotFinCENquot), the division within the Department of the Treasury that administers the BSA, provides useful information for helping financial institutions, including broker-dealers, meet their BSA obligations. See FinCEN Web site fincen. gov/ . G. Office of Foreign Assets Control Broker-dealers have an obligation to comply with the sanctions programs administered by the Department of Treasury39s Office of Foreign Assets Control (OFAC). OFAC administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction. 14 OFAC acts under Presidential wartime and national emergency powers, as well as authority granted by specific legislation, to impose controls on transactions and freeze foreign assets under US jurisdiction. OFAC39s sanctions programs are separate and distinct from, and in addition to, the anti-money laundering requirements imposed under the BSA on broker-dealers. 15 Unlike the BSA, OFAC programs apply to all U. S. persons and are applicable across business lines. OFAC programs are also strict liability programs mdash there are no safe harbors and no de minimis standards, although having a comprehensive compliance program in place could act as a mitigating factor in any enforcement action. OFAC publishes regulations implementing each of its programs, which include trade restrictions and asset blockings against particular countries and parties tied to terrorism, narcotics trafficking, proliferation of weapons of mass destruction, as well as a number of programs targeting members of certain foreign jurisdictions. As part of its efforts to implement these programs, OFAC publishes a list of Specially Designated Nationals, which is frequently updated on an as-needed basis. 16 In general, OFAC regulations require you to do the following: block accounts and other property of specified countries, entities, and individuals prohibit or reject unlicensed trade and financial transactions with specified countries, entities, and individuals and report all blockings and rejections of prohibited transactions to OFAC within ten days of the occurrence and annually. 17 OFAC has the authority to impose civil penalties of over 1,000,000 per count for violations of its sanctions programs. OFAC has stated that it will take into account the adequacy of your OFAC compliance program when it evaluates whether to impose a penalty if an OFAC violation occurs. To guard against engaging in OFAC prohibited transactions, you should generally follow a best practice of quotscreening againstquot the OFAC lists. 18 Consistent with this best practice, you should take care to screen all new accounts, existing accounts, customers and relationships against the OFAC lists, including any updates to the lists. This screening should include originators or recipients of wire and securities transfers. 19 H. Business Continuity Planning The Commission, Federal Reserve Board, and Comptroller of the Currency published an interagency White Paper emphasizing the importance of core clearing and settlement organizations and establishing guidelines for their capacity and ability to restore operations within a short time of a wide-scale disruption. 20 Separately, the Commission also published a Policy Statement urging the organized securities markets to improve their business continuity arrangements, 21 and encouraging SRO-operated markets and electronic communications networks, or ECNs to establish plans to enable the restoration of trading no later than the business day following a wide-scale disruption. In 2004, NASD and the NYSE adopted rules requiring every member to establish and maintain a business continuity plan, with elements as specified in the rules, and to provide the respective SROs with emergency contact information. See NASD Rule 3510 and NYSE Rule 446. See also . sec. gov/rules/sro/nasd/34-49537.pdf . IX. WHERE TO GET FURTHER INFORMATION For general questions regarding broker-dealer registration and regulation: Office of Interpretation and Guidance Division of Trading and Markets U. S. Securities and Exchange Commission 100 F Street, NE Washington, DC 20549 (202) 551-5777 e-mail: tradingandmarketssec. gov For additional information about how to obtain official publications of SEC rules and regulations, and for on-line access to SEC rules: Superintendent of Documents Government Printing Office Washington, DC 20402-9325 gpo. gov For copies of SEC forms and recent SEC releases, Publications Section U. S. Securities and Exchange Commission 100 F Street, NE Washington, DC 20549 (202) 551-4040 Other useful addresses, telephone numbers, and websites: SEC39s website: sec. gov The SEC39s website contains contact numbers for SEC offices in Washington and for the SEC39s regional offices: sec. gov/contact/addresses. htm . Financial Industry Regulatory Authority 9509 Key West Avenue Rockville, MD 20850 (301) 590-6500 (call center) (800) 289-9999 (to check on the registration status of a firm or individual) finra. org New York Stock Exchange, Inc. 20 Broad Street New York, NY 10005 (212) 656-3000 nyse North American Securities Administrators Association, Inc. 750 First Street, NE, Suite 1140 Washington, DC 20002 (202) 737-0900 nasaa. org Municipal Securities Rulemaking Board gt1900 Duke Street, Suite 600 Alexandria, VA 22314 (703) 797-6600 msrb. org Securities Investor Protection Corporation 805 15th Street, N. W. Suite 800 Washington, D. C. 20005-2215 (202)371-8300 sipc. org e-mail: asksipcsipc. org We wish to stress that we have published this guide as an introduction to the federal securities laws that apply to brokers and dealers. It only highlights and summarizes certain provisions, and does not relieve anyone from complying with all applicable regulatory requirements. You should not rely on this guide without referring to the actual statutes, rules, regulations, and interpretations. 1 The Division of Trading and Markets was known as the Division of Market Regulation from August 7, 1972, until November 14, 2007. 2 The treatment of dividend (or interest) reinvestment and stock purchase plans is addressed in Rule 102(c) of Regulation M. ( See Part V. A.7.) 3 Section 9(a) prohibits particular manipulative practices regarding securities registered on a national securities exchange. Section 10(b) is a broad quotcatch-allquot provision that prohibits the use of quotany manipulative or deceptive device or contrivancequot in connection with the purchase or sale of any security. Sections 15(c)(1) and 15(c)(2) apply to the over-the-counter markets. Section 15(c)(1) prohibits broker-dealers from effecting transactions in, or inducing the purchase or sale of, any security by means of quotany manipulative, deceptive or other fraudulent device, quot and Section 15(c)(2) prohibits a broker-dealer from making fictitious quotes. 4 These include Rules 10b-1 through 10b-18, 15c1-1 through 15c1-9, 15c2-1 through 15c2-11, and Regulation M. 5 In addition, Rule 11Ac1-3 requires broker-dealers to inform their customers, upon opening a new account and annually thereafter, of their policies regarding payment for order flow and for determining where to route a customer39s order. 6 The purpose of this disclosure is to inform the customer of the nature and extent of a broker-dealer39s conflict of interest. Broker-dealers are neither required to disclose the precise amount of these payments nor any formula that would allow a customer to calculate this amount. Nevertheless, Rule 10b-10 is not a safe harbor from the anti-fraud provisions. Recent enforcement actions have indicated that failures to disclose the nature and extent of the conflict of interest may violate Section 17(a)(2) of the 1933 Act. See Edward D. Jones amp Co. L. P. Securities Exchange Act Release No. 50910 (Dec. 22, 2004) Morgan Stanley DW, Inc. Securities Exchange Act Release No. 48789 (Nov. 17, 2003). 7 SEC, Report by Division of Market Regulation, Broker-Dealer Policies and Procedures Designed to Segment the Flow and Prevent the Misuse of Material Non-Public Information, 1989-1990 Transfer Binder Fed. Sec. L. Rep. (CCH) 84,520 at p. 80, 620-25 (March, 1990). 8 Rule 15g-1(a)(1) establishes a transaction exemption for brokers or dealers whose commission equivalents, mark-ups, and mark-downs from transactions in penny stocks during each of the immediately preceding three months and during eleven or more of the preceding twelve months, or during the immediately preceding six months, did not exceed five percent of its total commissions, commission equivalents, mark-ups, and mark-downs from transactions in securities during those months. 9 Exemptions from the requirements of Exchange Act Rules 15g-2 through 15g-6 are provided for non-recommended transactions, broker-dealers doing a minimal business in penny stocks, trades with institutional investors, and private placements. See Rule 15g-1. Rule 15g-9(c) exempts certain transactions from the requirements of Rule 15g-9. 10 See Certain Broker-Dealers Deemed Not To Be Investment Advisers, Exchange Act Release No. 51523 (April 12, 2005). 11 Rules 17a-2, 17a-7, 17a-8, 17a-10 and 17a-13 contain additional recordkeeping and reporting requirements that apply to broker-dealers. 12 When a broker-dealer is a member of more than one SRO, the SEC designates the SRO responsible for examining such broker-dealer for compliance with financial responsibility rules (the quotdesignated examining authorityquot). 13 The Currency and Foreign Transactions Reporting Act of 1970 (commonly referred to as the quotBank Secrecy Actquot) is codified at 31 U. S.C. 5311, et seq. The regulations implementing the Bank Secrecy Act are located at 31 CFR Part 103. 14 A list of countries subject to OFAC sanctions, as well as a list of individuals and companies owned or controlled by, or acting for or on behalf of, targeted counties (collectively called Specially Designated Nationals (SDNs)), is available on the OFAC website: treas. gov/ofac . A summary of OFAC regulations as they apply to the securities industry can be found at the following link: treas. gov/offices/enforcement/ofac/regulations/t11facsc. pdf See also Federal Financial Institutions Examination Council Bank Secrecy Act/Anti-Money Laundering Examination Manual (quotFFIEC Manualquot), at pages 137-145 (8/24/2007). The FFIEC Manual contains an entire section outlining best practices for OFAC Compliance, including risk matrices. Although that manual is written for the banking community, it provides information which may be useful to broker-dealers. 15 See also FinCEN Interpretive Release No. 2004-02 quotUnitary Filing of Suspicious Activity and Blocking Reports, quot 69 Fed. Reg. 76847 (Dec. 23, 2004). 16 OFAC offers a RISS feed service as well as an email notice system which pushes out digital information about its programs, including updates to its SDN List. See treas. gov/ofac. These may be especially helpful to smaller firms whose OFAC compliance programs are more manual in nature. 17 You will find forms for blocking and rejection reports on OFAC39s website using the following links: 18 The Financial Industry Regulatory Authority (FINRA) offers a tool that assists firms to search for names on OFAC lists: apps. finra. org/RulesRegulation/OFAC/1/Default. aspx . 19 See also FFIEC Manual at 140 (quotthe extent to which the bank includes account parties other than accountholders (e. g. beneficiaries, guarantors, principals, beneficial owners, nominee shareholders, directors, signatories, and powers of attorney) in the initial OFAC review during the account opening process, and during subsequent database reviews of existing accounts, will depend on the bank39s risk profile and available technology. quot). 20 Interagency Paper on Sound Practices to Strengthen the Resilience of the U. S. Financial Systems, Securities Exchange Act Release No. 47638 (April 7, 2003), 68 FR 17809 (April 11, 2003), sec. gov/news/studies/34-47638.htm . 21 Policy Statement: Business Continuity Planning for Trading Markets, Securities Exchange Act Release No. 48545 (September 25, 2003), 68 FR 56656 (October 1, 2003), sec. gov/rules/policy/34-48545.htm. Eight Steps to Successful Trader Tax Filing By Jim Forrester, CPA tradersaccounting Each New Year brings to a close a trading tax cycle and officially begins the preparation for our annual reckoning with the Internal Revenue Service. If your income exceeded your expectations, you can bring that sense of accomplishment to the daunting job of tax planning if not, we can often help you recoup some of your shortfall through prudent tax strategies. Advance tax planning is a particularly good idea this year, due to changes to the tax code created by the Working Families Tax Relief Act and the American Jobs Creation Act of 2004. Because every trader faces unique circumstances, there can be no cookie-cutter, one - size-fits-all tax solution across the board. It is important to consult with a Traders Accounting tax professional before making any decision that could impact your federal income tax and/or trader tax status. Here are eight important points to consider in filing a successful tax return: 1. Protect Your Trader Tax Status Nothing can throw a monkey wrench into your tax plan like being denied trader tax status by the Internal Revenue Service. Because trader status is constantly evolving with each tax court decision, it is especially important to position yourself well within the IRS working parameters before proceeding. According to the IRS, to qualify as a trader, you must 1) seek to profit from daily market movements in the prices of securities and not from dividends, interest or capital appreciation 2) your activity must be substantial and 3) you must carry on the activity with continuity and regularity. Falha qualquer parte desse teste e você será tratado como um investidor, não um comerciante, para fins fiscais. Whats at stake Investors are subject to the 2 threshold for deductible investment expenses (and hence cannot write off most of their expenses) and are limited to a 3, 000 capital loss deduction. Mas, como um comerciante, você pode anular 100 de suas despesas, e se você eleger a mark-to-market (MTM) opção de contabilidade, pode compensar todas as suas perdas contra a renda. Mas lembre-se se o seu status de comerciante é negado por uma auditoria do IRS perder a sua eleição MTM. New this year: The Frank Chen case. A curious tax court ruling last summer in the case of Frank Chen cast a dark cloud over the trader tax status of certain filers. In the Chen case, the judge agreed with the IRS in denying Chens trader tax status based in part on the fact that trading was not Chens quotsole and primary income - producing activity. quot If you make more money at another job, or even have another job in addition to your trading, be sure to consult a Traders Accounting tax professional before proceeding with your tax preparations. 2. File a Timely Extension Because of the complexities of filing a trader tax return, its often a good idea to file an extension. If you file an Automatic Extension by the tax deadline of April 15, your tax deadline is automatically moved to Aug. 16. If you need additional time to complete your taxes, you can file for a second extension by Aug. 16, which would move your tax deadline to Oct. 15. But this second extension is not automatic you must provide a reason for needing extra time and receive the form back marked quotgrantedquot by the IRS. Bear in mind that an extension only gives you extra time to file you must still pay at least 90 of what you owe by the original April 15 deadline, or your Automatic Extension will be ruled invalid and youll be slapped with late penalties of 5 per month up to five months, as well as interest expense on all tax payments after April 15. 3. Report on the Correct Forms Many traders mistakenly report all trading income on Schedule D (Capital Gains and Losses). To avoid this common error, if you elected mark-to-market accounting, you should list your trading activity on Form 4797 (Sales of Business Property), and if you traded in futures or forex, you should report these trades on Form 6781 (Gains and Losses from Section 1256 Contracts and Saddles). 4. Dont Depend on IRA Trades for Trader Status If you are trading in your individual retirement account or 401(k) plan the IRS wont count those trades toward your trader tax status, even if you meet the other trader requirements. 5. Beware Missteps on quotManaged Accountsquot If you have quotmanaged accountsquot in which you have hired another trader to conduct your trades, the IRS will not count that activity toward your trader tax status, nor allow you to take expenses against it. To successfully claim trader tax status, you must actually be the one quotpulling the triggerquot on the trades. 6. Prepare Before Proceeding with Mark-to-Market The rules of mark-to-market election couldnt be clearer: in order to use MTM this year, you must have notified the IRS of your election by the tax deadline last year. You would then begin using MTM this year by enclosing IRS Form 3115 along with your tax return. But before you make the switch, make sure you separate your investment holdings from your trading stocks and options. Why Because unless they are clearly separated, you will be required to mark them to market at years end and report any gain as ordinary income. That could prove disastrous for stocks that have greatly increased in value over time. A decisão de eleger mark-to-market não deve ser introduzida de forma ligeira pode ter um profundo impacto positivo ou negativo em seus impostos. Once you elect MTM, there is no going back without IRS approval. Consulte um comerciante Contabilidade fiscal profissional para ver se mark-to-market é ideal para você. Lembre-se novamente que MTM é um método de contabilidade apenas para os comerciantes que o comércio como um negócio. 7. Incluir um registro de negociação completo Os comerciantes que elegem a marca de mercado são muitas vezes sob a concepção errada de que eles precisam apenas fornecer seu saldo inicial e final em seu retorno de imposto e não conta para os comércios entre eles. The IRS has requested that every trader send in a schedule showing all of his or her trades for the tax year, whether filing as a trader or investor. The lone exception is for those trading in futures or forex you need only submit a net figure (use IRS Form 6781). 8. Thank Your Spouse (Again) Married traders have another good reason to thank their spouse this year: The Working Families Tax Relief Act eliminates the so-called quotmarriage penaltyquot by increasing the standard deduction to double the amount given to single taxpayers through 2010. Trader tax preparation is an often-arduous process that requires a thorough command of current tax law, recent tax court rulings and IRS interpretation. Before making any decisions that could affect your trader tax status or return, we recommend that you consult a traders tax professional to determine your best course of action. TRI inventou um diário comprovado especial que elimina a procrastinação. This diary has all the questions needed by the IRS to audit proof your: - Entertainment and meal expenses - Recreational activities and sporting events - Commuting expenses - Business trips - And even parking meters amp pay phones The key is that these tax questions and potential tax deductions in front of you daily. You are constantly reminded of how to maximize your tax write-offs everyday. The diary has worked so well that virtually everyone who has used it has noted that its very easy to use since all the questions are there, and it has worked miracles on IRS audits. It has withstood almost every audit it has come up against. Even the IRS agents were amazed at how good the system has proven to be. Talk to you soon,