[Federal Register Volume 84, Number 201 (Thursday, October 17, 2019)]
[Notices]
[Pages 55600-55601]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-22580]
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SECURITIES AND EXCHANGE COMMISSION
[SEC File No. 270-601, OMB Control No. 3235-0673]
Submission for OMB Review; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736.
Extension: Rule 15c3-5.
Notice is hereby given that, pursuant to the Paperwork Reduction
Act of 1995 (``PRA'') (44 U.S.C. 3501 et seq.) (``PRA''), the
Securities and Exchange Commission (``Commission'') has submitted to
the Office of Management and Budget (``OMB'') a request for approval of
extension of the previously approved collection of information provided
for in Rule 15c3-5 (17 CFR 240.15c3-5) under the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.) (``Exchange Act'').
Rule 15c3-5 under the Exchange Act requires brokers or dealers with
access to trading directly on an exchange or alternative trading system
(``ATS''),
[[Page 55601]]
including those providing sponsored or direct market access to
customers or other persons, to implement risk management controls and
supervisory procedures reasonably designed to manage the financial,
regulatory, and other risks of this business activity.
The rule requires brokers or dealers to establish, document, and
maintain certain risk management controls and supervisory procedures as
well as regularly review such controls and procedures, and document the
review, and remediate issues discovered to assure overall effectiveness
of such controls and procedures. Each such broker or dealer is required
to preserve a copy of its supervisory procedures and a written
description of its risk management controls as part of its books and
records in a manner consistent with Rule 17a-4(e)(7) under the Exchange
Act. Such regular review is required to be conducted in accordance with
written procedures and is required to be documented. The broker or
dealer is required to preserve a copy of such written procedures, and
documentation of each such review, as part of its books and records in
a manner consistent with Rule 17a-4(e)(7) under the Exchange Act, and
Rule 17a-4(b) under the Exchange Act, respectively.
In addition, the Chief Executive Officer (or equivalent officer) is
required to certify annually that the broker or dealer's risk
management controls and supervisory procedures comply with the rule,
and that the broker-dealer conducted such review. Such certifications
are required to be preserved by the broker or dealer as part of its
books and records in a manner consistent with Rule 17a-4(b) under the
Exchange Act. Compliance with Rule 15c3-5 is mandatory.
Respondents consist of broker-dealers with access to trading
directly on an exchange or ATS. The Commission estimates that there are
currently 570 respondents. To comply with Rule 15c3-5, these
respondents will spend a total of approximately 91,200 hours per year
(160 hours per broker-dealer x 570 broker-dealers = 91,200 hours). At
an average internal cost per burden hour of approximately $358.51, the
resultant total related internal cost of compliance for these
respondents is $32,696,340 per year (91,200 burden hours multiplied by
approximately $358.51/hour). In addition, for hardware and software
expenses, the Commission estimates that the average annual external
cost would be approximately $20,500 per broker-dealer, or $11,685,000
in the aggregate ($20,500 per broker-dealer x 570 brokers and dealers =
$11,685,000).
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB control number.
The public may view background documentation for this information
collection at the following website: www.reginfo.gov. Comments should
be directed to: (i) Desk Officer for the Securities and Exchange
Commission, Office of Information and Regulatory Affairs, Office of
Management and Budget, Room 10102, New Executive Office Building,
Washington, DC 20503, or by sending an email to:
[email protected]; and (ii) Charles Riddle, Acting Director/
Chief Information Officer, Securities and Exchange Commission, c/o
Candace Kenner, 100 F Street NE, Washington, DC 20549, or by sending an
email to: [email protected]. Comments must be submitted to OMB within
30 days of this notice.
Dated: October 10, 2019.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-22580 Filed 10-16-19; 8:45 am]
BILLING CODE 8011-01-P