[Federal Register Volume 88, Number 43 (Monday, March 6, 2023)]
[Notices]
[Pages 13860-13861]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-04541]


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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-455, OMB Control No. 3235-0514]


Proposed Collection; Comment Request; Extension: Rule 8c-1

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 
20549-2736

    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'') is soliciting comments on the existing 
collection of information provided for in Rule 8c-1 (17 CFR 240.8c-1), 
under the Securities Exchange Act of 1934 (``Exchange Act'') (15 U.S.C. 
78a et seq.). The Commission plans to submit this existing collection

[[Page 13861]]

of information to the Office of Management and Budget (``OMB'') 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, Rule 8c-1 
states three main principles: (1) a broker-dealer is prohibited from 
commingling the securities of different customers as collateral for a 
loan without the consent of each customer; (2) a broker-dealer cannot 
commingle customers' securities with its own securities under the same 
pledge; and (3) a broker-dealer can only pledge its customers' 
securities to the extent that customers are in debt to the broker-
dealer. Additionally, Rule 8c-1 requires broker-dealers to make certain 
written notifications to pledgees in connection with such use of 
customer securities as collateral.\1\
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    \1\ See Exchange Act Release No. 2690 (November 15, 1940); 
Exchange Act Release No. 9428 (December 29, 1971).
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    The information required by Rule 8c-1 is necessary for the 
execution of the Commission's mandate under the Exchange Act to prevent 
broker-dealers from hypothecating or arranging for the hypothecation of 
any securities carried for the account of any customer under certain 
circumstances. In addition, the information required by Rule 8c-1 
provides important investor protections.
    There are approximately 43 respondents as of the end of 2022 (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). Each respondent makes an 
estimated 45 annual responses, for an aggregate total of approximately 
1,935 responses per year.\2\ Each response takes approximately 0.5 
hours to complete. Therefore, the total third-party disclosure burden 
per year is approximately 968 hours.\3\
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    \2\ 43 respondents x 45 annual responses = 1,935 aggregate total 
of annual responses.
    \3\ 1,935 responses x 0.5 hours = 967.5 hours, rounded up to 968 
hours.
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    Written comments are invited on: (a) whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the Commission, including whether the information 
shall have practical utility; (b) the accuracy of the Commission's 
estimates of the burden of the proposed 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 by 
May 5, 2023.
    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.
    Please direct your written comments to: David Bottom, Director/
Chief Information Officer, Securities and Exchange Commission, c/o John 
Pezzullo, 100 F Street NE, Washington, DC 20549, or send an email to: 
[email protected].

    Dated: March 1, 2023.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-04541 Filed 3-3-23; 8:45 am]
BILLING CODE 8011-01-P