[Federal Register Volume 68, Number 96 (Monday, May 19, 2003)]
[Notices]
[Pages 27113-27114]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-12452]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of Filings and Information Services, Washington, DC 
20549.

Extension:
    Rule 206(4)-3; SEC File No. 270-218.
    OMB Control No. 3235-0242.
    Rule 206(4)-4 SEC File No. 270-304.
    OMB Control No. 3235-0345.

    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 collections 
of information summarized below. The Commission plans to submit these 
existing collections of information to the Office of Management and 
Budget for extension and approval.
    Rule 206(4)-3, which is entitled ``Cash Payments for Client 
Solicitations,'' provides restrictions on cash payments for client 
solicitations. The rule requires that an adviser pay all solicitors' 
fees pursuant to a written agreement. When an adviser will provide only 
impersonal advisory services to the prospective client, the rule 
imposes no disclosure requirements. When the solicitor is affiliated 
with the adviser and the adviser will provide individualized services, 
the solicitor must, at the time of the solicitation, indicate to 
prospective clients that he is affiliated with the adviser. When the 
solicitor is not affiliated with the adviser and the adviser will 
provide individualized services, the solicitor must, at the time of the 
solicitation, provide the prospective client with a copy of the 
adviser's brochure and a disclosure document containing information 
specified in rule 206(4)-3. The information rule 206(4)-3 requires is 
necessary to inform advisory clients about the nature of the 
solicitor's financial interest in the recommendation so they may 
consider the solicitor's potential bias, and to protect investors 
against solicitation activities being carried out in a manner 
inconsistent with the adviser's fiduciary duty to clients. Rule 206(4)-
3 is applicable to all Commission registered investment advisers. The 
Commission believes that approximately 1,560 of these advisers have 
cash referral fee arrangements. The rule requires approximately 7.04 
burden hours per year per adviser and results in a total of 
approximately 10,982 total burden hours (7.04 x 1,560) for all 
advisers.
    Rule 206(4)-4, which is entitled ``Financial and Disciplinary 
Information that Investment Advisers Must Disclose to Clients,'' 
requires advisers to disclose certain financial and disciplinary 
information to clients. The disclosure requirements in rule 206(4)-4 
are designed so that clients will have information about an adviser's 
financial condition and disciplinary events that may be material to an 
evaluation of the adviser's integrity or ability to meet contractual 
commitments to clients. We estimate that approximately 1,349 advisers 
are subject to this rule. The rule requires approximately 7.5 burden 
hours per year per adviser and amounts to approximately 10,118 total 
burden hours (7.5 x 1,349) for all advisers.
    Written comments are invited on: (a) Whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the agency, including whether the information will 
have practical utility; (b) the accuracy of the agency's estimate of 
the burden of the collection of information; (c) ways to enhance the 
quality, utility, and clarity of the information 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.

[[Page 27114]]

    Please direct your written comments to Kenneth A. Fogash, Acting 
Associate Executive Director/CIO, Office of Information Technology, 
Securities and Exchange Commission, 450 5th Street, NW., Washington, DC 
20549.

    Dated: May 12, 2003.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-12452 Filed 5-16-03; 8:45 am]
BILLING CODE 8010-01-P