
[Federal Register: October 29, 2010 (Volume 75, Number 209)]
[Notices]               
[Page 66805-66806]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29oc10-134]                         

=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

 
Proposed Collection; Comment Request

Upon Written Request, Copies Available From: U.S. Securities and 
Exchange Commission, Office of Investor Education and Advocacy, 
Washington, DC 20549-0213.
Existing Collection in Use Without an OMB Number: Rule 8c-1; SEC File 
No. 270-455; OMB Control No. 3235-0514.

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') is soliciting comments on the collection of 
information summarized below. The Commission plans to submit this 
existing collection of information to the Office of Management and 
Budget for Approval.
    Rule 8c-1 (17 CFR 240.8c-1) under the Securities Exchange Act of 
1934 (15 U.S.C. 78a et seq.) generally prohibits a broker-dealer from 
using its customers' securities as collateral to finance its own 
trading, speculating, or underwriting transactions. More specifically, 
the rule states three main principles: first, that a broker-dealer is 
prohibited from commingling the securities of different customers as 
collateral for a loan without the consent of each customer; second, 
that a broker-dealer cannot commingle customers' securities with its 
own securities under the same pledge; and third, that a broker-dealer 
can only pledge its customers' securities to the extent that customers 
are in debt to the broker-dealer. See Securities Exchange Act Release 
No. 2690 (November 15, 1940); Securities Exchange Act Release No. 9428 
(December 29, 1971). Pursuant to Rule 8c-1, respondents must collect 
information necessary to prevent the hypothecation of customer accounts 
in contravention of the rule, issue and retain copies of notices to the 
pledgee of hypothecation of customer accounts in accordance with the 
rule, and collect written consents from customers in accordance with 
the rule. The information is necessary to ensure compliance with the 
rule, and to advise customers of the rule's protections.
    There are approximately 111 respondents per year (i.e., broker-
dealers that conducted business with the public, filed Part II of the 
FOCUS Report, did not claim an exemption from the Reserve Formula 
computation, and reported that they had a bank loan during at least one 
quarter of the current year) that require an aggregate total of 2,498 
hours to comply with the rule. Each of these approximately 111

[[Page 66806]]

registered broker-dealers makes an estimated 45 annual responses, for 
an aggregate total of 4,995 responses per year. Each response takes 
approximately 0.5 hours to complete. Thus, the total compliance burden 
per year is 2,498 burden hours. The approximate cost per hour is $59, 
resulting in a total cost of compliance for the respondents of 
approximately $147,382 (2,498 hours @ $59 per hour).
    Written comments are invited on: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information shall have practical 
utility; (b) the accuracy of the agency's estimate of the burden of the 
proposed collection of information; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (d) ways 
to minimize the burden of the collection of information on respondents, 
including through the use of automated collection techniques or other 
forms of information technology. Consideration will be given to 
comments and suggestions submitted in writing within 60 days of this 
publication.
    Please direct your written comments to: Jeffrey Heslop, Acting 
Chief Information Officer, Securities and Exchange Commission, c/o Remi 
Pavlik-Simon, 6432 General Green Way, Alexandria, Virginia 22312 or 
send an e-mail to: PRA_Mailbox@sec.gov.

    Dated: October 25, 2010.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-27366 Filed 10-28-10; 8:45 am]
BILLING CODE 8011-01-P

