[Federal Register Volume 85, Number 208 (Tuesday, October 27, 2020)]
[Notices]
[Pages 68104-68105]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-23748]


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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-094, OMB Control No. 3235-0085]


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 17a-11

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (``PRA'') (44 U.S.C. 3501 et seq.), 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 17a-
11, Notification Provisions for Brokers and Dealers (17 CFR 240.17a-
11), under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) 
(``Exchange Act'').
    In response to an operational crisis in the securities industry 
between 1967 and 1970, the Commission adopted Rule 17a-11 under the 
Exchange Act on July 11, 1971. Rule 17a-11 requires broker-dealers that 
are experiencing financial or operational difficulties to provide 
notice to the Commission, the broker-dealer's designated examining 
authority (``DEA''), and the Commodity Futures Trading Commission 
(``CFTC'') if the broker-dealer is registered with the CFTC as a 
futures commission merchant. Rule 17a-11 is an integral part of the 
Commission's financial responsibility program which enables the 
Commission, a broker-dealer's DEA, and the CFTC to increase 
surveillance of a broker-dealer experiencing difficulties and to obtain 
any additional information necessary to gauge the broker-dealer's 
financial or operational condition.
    Rule 17a-11 also requires over-the-counter (``OTC'') derivatives 
dealers and broker-dealers that are permitted to compute net capital 
pursuant to Appendix E to Exchange Act Rule 15c3-1 to notify the 
Commission when their tentative net capital drops below certain levels.
    To ensure the provision of these types of notices to the 
Commission, Rule 17a-11 requires every national securities exchange or 
national securities association to notify the Commission when it learns 
that a member broker-dealer has failed to send a notice or transmit a 
report required under the Rule.
    Compliance with the Rule is mandatory. The Commission will 
generally not publish or make available to any person notices or 
reports received pursuant to Rule 17a-11. The Commission believes that 
information obtained under Rule 17a-11 relates to a condition report 
prepared for the use of the Commission, other federal governmental 
authorities, and securities industry self-regulatory organizations 
responsible for the regulation or supervision of financial 
institutions.
    The Commission expects to receive 343 notices from broker-dealers 
whose capital declines below certain specified levels or who are 
otherwise experiencing financial or operational problems and eleven 
notices each year from national securities exchange or national 
securities association notifying it that a member broker-dealer has 
failed to send the Commission a notice or transmit a report required 
under the Rule. The Commission expects that it will take approximately 
one hour to prepare and transmit each notice. Therefore, the Commission 
estimates the total annual reporting burden arising from this section 
of the rule will be approximately 354 hours.\1\
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    \1\ 343 hours + 11 hours = 354 hours.
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    Rule 17a-11 also requires broker-dealers engaged in securities 
lending or repurchase activities to either: (1) File a notice with the 
Commission and their DEA whenever the total money payable against all 
securities loaned, subject to a reverse repurchase agreement or the 
contract value of all securities borrowed or subject to a repurchase 
agreement, exceeds 2,500% of tentative net capital; or, alternatively, 
(2) report monthly their securities lending and repurchase activities 
to their DEA in a form acceptable to their DEA.
    The Commission estimates that, annually, six broker-dealers will 
submit the monthly stock loan/borrow report. The Commission estimates 
each firm will spend, on average, approximately one hour per month (or 
twelve hours per year) of employee resources to prepare and send the 
report or to prepare the information for the FOCUS report (as required 
by the firm's DEA, if applicable). Therefore, the Commission estimates 
the total annual reporting burden arising from this section of the rule 
will be approximately 72 hours.\2\
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    \2\ 6 broker-dealers x 12 hours per year = 72 hours.
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    Therefore, the total annual reporting burden associated with Rule 
17a-11 is approximately 426 hours.\3\
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    \3\ 343 hours + 11 hours + 72 hours = 426 hours.
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    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. Find this 
particular information collection by selecting ``Currently under 30-day 
Review--Open for Public Comments'' or by using the search function. 
Written comments and

[[Page 68105]]

recommendations for the proposed information collection should be sent 
within 30 days of publication of this notice to (i) 
MBX.OMB.OIRA.SEC_desk_officer@omb.eop.gov and (ii) David Bottom, 
Director/Chief Information Officer, Securities and Exchange Commission, 
c/o Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or by 
sending an email to: PRA_Mailbox@sec.gov.

    Dated: October 22, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-23748 Filed 10-26-20; 8:45 am]
BILLING CODE 8011-01-P


