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U.S. Securities and Exchange Commission

Final Rule Amendments to Books and Records Requirements for Brokers and Dealers Under the Securities Exchange Act of 1934



Washington, DC, October 25, 2001 — The Securities and Exchange Commission today adopted final rule amendments to the broker-dealer books and records rules (Rule 17a-3 and Rule 17a-4) under the Securities Exchange Act of 1934. The amendments clarify and expand recordkeeping requirements including those for purchase and sale documents, customer records, associated person records, customer complaints, communications with the public, and supervisory procedures. In addition, the amendments require broker-dealers to maintain or promptly produce certain records at each office to which those records relate. These amendments are specifically designed to assist securities regulators when conducting sales practice examinations of broker-dealers, particularly examinations of local offices.

The amended rules contain the following general provisions, among others:

  • A broker-dealer must create a record containing certain minimum information as to each customer and furnish that information to the customer on a periodic basis. A broker-dealer does not have this requirement for an account for which the firm is not required (under any federal or SRO rules) to make a suitability determination.
  • A broker-dealer must create and maintain certain records for each office of the broker-dealer, and these records must either be maintained at that office or delivered to that office promptly upon request.
  • A broker-dealer must include additional information on each order ticket, including the identity of the associated person, if any, responsible for the account and any other person who entered or accepted the order on behalf of the customer.

The final rules will become effective 18 months after the date of publication in the Federal Register.

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Modified: 10/25/2001