Division of Market Regulation
Broker-Dealer Net Capital
and Books and Records Guidance

Related No-Action, Exemptive, and Interpretive Letters

Note: These materials are provided in Adobe Acrobat (PDF) format.

Broker-Dealer Books and Records Requirements

• Securities Industry Association, re: Permissibility of Sending Financial Statements with Quarterly Customer Statements (Feb. 26, 2001)
  (incoming letter also available)
   
• Chicago Board Options Exchange, Inc., re: Extension of Time for Certain Floor Traders to File Annual FOCUS Reports (Jan. 5, 2000)
  (incoming letter also available)
   
• New York Stock Exchange, Inc., re: Prime Broker Arrangements between Broker-Dealers & Certain Investment Advisers, (permanent extension of the 1994 prime broker no action letter) (Dec. 30, 1999)
  (incoming letter also available)
   
• Prime Broker Committee, re: Prime Broker Committee Request (Jan. 25, 1994)
  (two incoming letters also available: Sept. 13, 1989 and June 3, 1991)

Broker-Dealers Customer Protection Rule - Rule 15c3-3

• Lawrence, Kamin, Saunders & Uhlenhop, re: Clearing Government Securities Transactions for Registered Floor Persons (Dec. 27, 2000)
  (incoming letter also available)
   
• Options Clearing Corporation, re: Definition of "Customer" for Purposes of the Hypothecation Rules (Jun. 15, 2000)
  (incoming letter also available)
   
• New York Stock Exchange, Inc., and NASD Regulation, Inc., re: Proprietary Accounts of Introducing Brokers and Dealers (Nov. 3, 1998)
   
• Cantor Fitzgerald Securities, re: Treatment of OTC Treasury Options Matched Book Collateral for Cantor Fitzgerald Securities (Oct. 7, 1998)
  (incoming letter also available)
   

Broker-Dealers Net Capital Requirements - Rule 15c3-1

• Securities Industry Association, re: Temporary Relief from Certain Provisions of the Net Capital Rule, (Feb. 19, 2004)
  (incoming letter also available)
   
• Fimat USA, Inc., re: Short Option Value Charge Relief for Options on Interest Rate Futures (Jan. 5, 2004)
  (incoming letter also available)
   
• New York Stock Exchange, Inc., and NASD Regulation, Inc., re: Recording Certain Broker-Dealer Expenses and Liabilities (Jul. 11, 2003)
   
• Securities Industry Association, re: Net Capital Treatment of Failed to Deliver Contracts in Non-Marketable Securities Outstanding Less than 30 Business Days (Jul. 13, 2001)
  (incoming letter also available)
   
• Securities Industry Association, re: Marketability of Asset-Backed Securities Issued by Special Purpose Vehicles (Jul. 13, 2001)
  (incoming letter also available)
   
• Man Financial, Inc., re: Request for Relief from the Short Option Value Charge (Apr. 19, 2001)
  (incoming letter also available)
   
• Depository Trust Company, re: Net Capital Treatment of Class A Preferred Stock Issued by the Depository Trust Company (Aug. 21, 2000)
  (incoming letter also available)
   
• Securities Industry Association, re: Portfolio Concentration Charges for Certain Securities Under Rule 15c3-1 of the Securities Exchange Act of 1934 (certain debt securities and preferred stock) (Jul. 27, 2000)
  (incoming letter also available)
   
• Securities Industry Association, re: Marketability of Certain Securities (below-investment-grade-rated and single-rated debt securities and preferred stock) (Jul. 27, 2000)
  (incoming letter also available)
   
• ABN AMRO, Inc., and Rothschild, Inc., re: Deductions for Open Contractual Commitments (Jun. 30, 2000)
  (incoming letter also available)
   
• New York Stock Exchange, Inc., and NASD Regulation, Inc., re: Net Capital Treatment of Temporary Capital Contributions (Feb. 23, 2000)
   
• Chicago Board Options Exchange, Inc., re: Extension of Subparagraph (b)(1)(iv) of Appendix A to Rule 15c3-1 of the Securities Exchange Act of 1934 (listed options and related hedge positions) (Jan. 13, 2000)
  (incoming letter also available)
   
• New York Stock Exchange, Inc., re: Net Capital Treatment for Foreign Issued, Foreign Settled Fail Items (Dec. 30, 1999)
  (incoming letter also available)
   
• Charles Schwab & Co., Inc., re: Net Capital Treatment of Deferred Tax Liabilities Directly Related to Capitalized Costs Associated With Internal Software Development (Oct. 25, 1999)
  (incoming letter also available)
   
• Advanced Clearing, Inc., re: Net Capital Treatment of Deferred Tax Liabilities Directly Related to Prepaid Advertising Expense (Oct. 25, 1999)
  (incoming letter also available)
   
• Chicago Board Options Exchange, Inc., re: Short Futures Options Value Charge (Feb. 25, 1999)
  (incoming letter also available)
   
• Chicago Board Options Exchange, Inc., re: Computation of Equity by Broker-Dealers Carrying Market-Maker Accounts of Listed Options Specialists (Jan. 19, 1999)
  (incoming letter also available)
   
• Integrated Management Solutions, re: Capital Treatment of Options Hedged with Convertible Securities (Jul. 8, 1998)
  (incoming letter also available)
   
• Government Securities Clearing Corporation, re: Deficit Charges on Repurchase Transactions (Apr. 1, 1998)
  (incoming letter also available)
   
• Securities Industry Association, re: Treatment of Certain Non-Registered Securities (Mar. 15, 1996)
   
• Securities Industry Association re: Ready Marketability of Noninvestment Grade, Nonconvertible Debt Securities, (Feb. 14, 1994)
   
• Securities Industry Association, re: Applicability of Certain Haircut Provisions to Certain Foreign and Domestic Debt Securities (Jun. 12, 1992)
  (two incoming letters also available: Aug. 14, 1990 and Nov. 12, 1989)

Commission Releases

• Order: Extension of Order Regarding Broker-Dealer Financial Statement Requirements under Section 17 of the Exchange Act (July 14, 2004; File name: 34-50020.htm)
   
• Commission Notice: Broker-Dealer Financial Statement Requirements under Section 17 of the Exchange Act (Aug. 4, 2003; File name: 34-48281.htm)
   
• Final Rule: Broker-Dealer Exemption from Sending Certain Financial Information to Customers (Aug. 1, 2003; File name: 34-48272.htm)
   
• Concept Release: Rating Agencies and the Use of Credit Ratings Under the Federal Securities Laws (June 4, 2003; File name: 33-8236.htm)
   
• Exemptive Order: Extending Broker-Dealer Exemption from Sending Financial Information to Customers (Nov. 26, 2002; File name: 34-46921.htm)
   
• Final Rule: Books and Records Requirements for Brokers and Dealers Under the Securities Exchange Act of 1934 (Oct. 26, 2001; File name: 34-44992.htm)
   
• Final Rule: OTC Derivatives Dealers (Oct. 23, 1998; File name: 34-40594.htm)
   
• Proposed Rule: Definition of Nationally Recognized Statistical Rating Organizations (Dec. 17, 1997; File name: 34-39457.txt)
   
• Final Rule: Electronic Recordkeeping: Reporting Requirements for Brokers or Dealers under the Securities Exchange Act of 1934 (Feb. 5, 1997; File name: 34-38245.txt)
   
• Concept Release: Nationally Recognized Statistical Rating Organizations (Aug. 31, 1994; File name: 34-34616.pdf - Adobe Acrobat (PDF) file)

Selected Statutory Provisions and Rules

• Risk Assessment: Section 17(h) (scroll down to Paragraph (h))
   
• Net Capital Rule: Rule 15c3-1
   
• Customer Protection Rule: Rule 15c3-3
   
• Records to be Made by Broker-Dealers: Rule 17a-3
   
• Records to be Preserved by Broker-Dealers: Rule 17a-4
   
• Broker-Dealer FOCUS Reports and Annual Audits: Rule 17a-5
   
• Early Warning Rule: Rule 17a-11
   
• Risk Assessment Rules: Rule 17h-1T; Rule 17h-2T

http://www.sec.gov/divisions/marketreg/bdnetcapital.htm