[Federal Register Volume 64, Number 92 (Thursday, May 13, 1999)]
[Notices]
[Pages 25945-25946]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-12069]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-41371; File No. SR-NASD-98-96; Amendment No. 4]
Self-Regulatory Organizations; Notice of Filing of Amendment No.
4 to Proposed Rule Change by the National Association of Securities
Dealers, Inc. Relating to Amendments to Forms U-4 and U-5
May 5, 1999.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 28, 1998, the National Association of Securities Dealers, Inc.
(``NASD'' or ``Association''), through its wholly owned subsidiary NASD
Regulation, Inc. (``NASD Regulation'' or ``NASDR''), filed with the
Securities and Exchange Commission (``SEC'' or ``Commission'')
Amendment No. 4 to the proposed rule change\3\ as described in Items I,
II and III below, which Items have been prepared by the NASD. The
Commission is publishing this notice to solicit comments on the
proposed rule change as further amended by Amendment No. 4 from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ The Commission previously published notice of the proposed
rule change on April 22, 1999. See Securities Exchange Act Release
No. 41326 (April 22, 1999), 64 FR 23366 (April 30, 1999) (File No.
SR-NASD-98-96).
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
Amendment No. 4 provides additional detail on how NASDR will
process the Proposed Forms U-4 and
U-5.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NASDR included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. NASDR has prepared summaries, set forth in Sections A,
B, and C below, of the most significant aspects of such statements.
[[Page 25946]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Amendment No. 4 clarifies two aspects of the proposal \4\ and
processing of the Proposed Forms U-4 and U-5 on the new World Wide Web-
based Central Registration Depository (``Web CRD''). When a firm
initiates a Form U-4 filing on Web CRD for the first time for an
individual with disclosure information, a blank Page 3 of the Proposed
Form U-4 will appear on the screen. Just as with the current paper
filing system, a firm will be required to fill out the entire Page 3 to
reflect all currently reportable disclosure information, some or all of
which may already have been reported to CRD. Thereafter, as a
convenience, a member will be able to retrieve the most recently filed
electronic Page 3 of the Form U-4 and edit it for submission, rather
than filling out the blank Page 3 for each subsequent filing.
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\4\ See supra note 3.
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There also will be paper processing available for one part of one
Disclosure Reporting Page (``DRP'') associated with the Proposed Form
U-5. The 1996 Form U-5 DRP for internal reviews contains a Part II,
which allows a terminated registered representative to provide a
summary of the circumstances relating to an internal review disclosure
submitted by the individual's former employer on the Form U-5. This
Part II also appears on the Proposed Form U-5 Internal Review DRP.
NASDR has informed the Commission staff that it is prepared to accept
paper submissions of this Part II information by a terminated
registered representative and that NASDR staff will enter the
information on to The Web CRD system on behalf of the terminated
registered representative.
2. Statutory Basis
NASDR believes that Amendment No. 4 is consistent with the
provisions of Section 15A(b)(6) of the Act, which requires, among other
things, that the Association's rules must be designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, and, in general, to protect investors
and the public interest. NASDR believes that Amendment No. 4 is
consistent with the NASD's authority to adopt appropriate qualification
and registration requirements for persons associated with NASD members
or applicants for NASD membership. Article V, Section 2 of the NASD By-
Laws authorizes the Board to prescribe the form used by any person who
wishes to make application for registration with the NASD. NASDR
believes that Amendment No. 4 will make the filing of information with
CRD easier and more efficient while continuing to provide complete
information for use by regulators, SROs, and firms conducting pre-hire
checks.
B. Self-Regulatory Organization's Statement on Burden on Competition
NASD Regulation does not believe that the proposed rule change, as
amended, will result in any burden on competition that is not necessary
or appropriate in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve such proposed rule change, or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
is consistent with the Act. Persons making written submissions should
file six copies thereof with the Secretary, Securities and Exchange
Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. Copies of
the submission, all subsequent amendments, all written statements with
respect to the proposed rule change that are filed with the Commission,
and all written communications relating to the proposed rule change
between the Commission and any person, other than those that may be
withheld from the public in accordance with the provisions of 5 U.S.C.
552, will be available for inspection and copying in the Commission's
Public Reference Room. Copies of such filing will also be available for
inspection and copying at the principal office of the NASD. All
submissions should refer to File No. SR-NASD-98-96 and should be
submitted by May 28, 1999.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\5\
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\5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-12069 Filed 5-12-99; 8:45 am]
BILLING CODE 8010-01-M