January 12, 1995
TO: BANK BROKER/DEALER ADVISORY COMMITTEE No. 1-95
BROKER/DEALER ADVISORY COMMITTEE No. 1-95
OPERATIONS MEMBERS No. 2-95
TRANSFER AGENT ADVISORY COMMITTEE No. 4-95
RE: NON-SIPC STATUS DISCLOSURE REQUIREMENTS
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As you are aware, the Securities and Exchange Commission’s (SEC) recently adopted
amendments to Rule 10b-10 under the Securities Exchange Act of 1934, will require disclosure
of non-SIPC membership on confirmations, effective April 3, 1995, in the event the broker or
dealer transmitting the confirm or clearing or carrying the customer account is not a member of
the Securities Investor Protection Corporation (SIPC). To help you comply with this
requirement, you will find attached a listing of those registered broker dealers currently
excluded from SIPC membership. This list is based on information provided to SIPC by the
brokerage industry, however its correctness cannot be guaranteed by SIPC.
Since this list will not remain static, we strongly suggest you move to amend/update all
current and future selling group agreements with third party broker dealers to require prompt
notice of any change to their SIPC status, as this will place the burden of notification on broker
dealers who, subsequent to the generation of the attached list (January 11, 1995) claim exclusion
from SIPC membership.
As noted in our December 23, 1994 memo (Operations Committee 37-94, TAAC 50-94)
the Institute continues to urge the SEC to reconsider its position and exempt from the required
disclosure those confirmations sent out by or on behalf of a mutual fund distributor or its
affiliated transfer agent. We will keep you apprised of developments on this issue
Kevin Farragher
Director of Operations
Distribution & Service