[Federal Register Volume 69, Number 133 (Tuesday, July 13, 2004)]
[Notices]
[Pages 42075-42076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-15784]


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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 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 extension and approval.
    Rule 8c-1 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 163 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 3,668 
hours to comply with the rule. Each of these approximately 163 
registered broker-dealers makes an estimated 45 annual responses, for 
an aggregate total of 7,335 responses per year. Each response takes 
approximately 0.5 hours to complete. Thus, the total compliance burden 
per year is 3,668 burden hours. The approximate cost per hour is $22, 
resulting in a total cost of compliance for the respondents of $80,696 
(3,668 hours @ $22 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

[[Page 42076]]

technology. Consideration will be given to comments and suggestions 
submitted in writing within 60 days of this publication.
    Direct your written comments to R. Corey Booth, Director/Chief 
Information Officer, Office of Information Technology, Securities and 
Exchange Commission, 450 5th Street, NW., Washington, DC 20549.

    Dated: July 6, 2004.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-15784 Filed 7-12-04; 8:45 am]
BILLING CODE 8010-01-P