December 31, 1996
TO: SEC RULES COMMITTEE No. 139-96
RE: INSTITUTE COMMENTS ON BROKER-DEALER BOOKS AND RECORDKEEPING
PROPOSALS
______________________________________________________________________________
The Institute recently submitted the attached comment letter on the proposed
amendments to the broker-dealer books and records rules under the Securities
Exchange Act of 1934. The Institute’s letter was revised slightly from the draft letter
previously circulated to you* to incorporate members’ comments. Among other things, the Institute’s request for an exemption for fund
underwriters from the proposed customer account form requirement was modified. Instead of structuring the exemption as a two prong test covering broker-dealers who (1)
serve as fund underwriters and (2) do not recommend securities to the investing public, the Institute’s final letter does not include the second prong. The letter expresses the
view, however, that broker-dealers who serve as fund underwriters and who also engage in other activities, including making recommendations to the investing public, should
be subject to the account form requirement with respect to those accounts for which recommendations are made.
Amy B.R. Lancellotta
Associate Counsel
Attachment
* See Memorandum to SEC Rules Committee No. 128-96, dated December 9, 1996.