FOR IMMEDIATE RELEASE                                  98-84


DIVISION OF MARKET REGULATION ISSUES STAFF LEGAL BULLETIN
NO. 8 DISCUSSING BROKER-DEALER ORDER HANDLING DURING CIRCUIT
BREAKER TRADING HALTS AND BROKER-DEALER RESPONSIBILITY TO
MAINTAIN ADEQUATE SYSTEMS CAPACITY


     Washington, D.C., September 11, 1998 -- On September 9,
1998, the staff of the Division of Market Regulation issued
Staff Legal Bulletin No. 8 (MR), in conjunction with the
release of the Division's reconstruction of market trading
that occurred on October 27 and 28, 1997.  Staff Legal
Bulletin No. 8 provides broker-dealers with guidance about
how to handle customer orders and notify customers when
marketwide circuit breakers halt trading.  The bulletin also
reminds broker-dealers about their responsibility to
maintain adequate internal systems capacity.

     When circuit breakers halted trading on October 27,
1997, a number of broker-dealers reportedly had problems
determining how to properly handle retail orders they had
received following the markets' early close.  Staff Legal
Bulletin No. 8 clarifies that on the rare occasions that
circuit breakers halt trading, broker-dealers should handle
pending and new orders the same way they currently handle
orders when a market imposes a regulatory trading halt.
Staff Legal Bulletin No. 8 also discusses the steps that
broker-dealers should take, during a circuit breaker trading
halt, to notify customers about how orders will be handled.

     Following the heavy trading volume on October 27 and
28, 1997, the Commission received several customer
complaints about poor or untimely executions from broker-
dealers, and about delays in accessing online brokerage
accounts.  Staff Legal Bulletin No. 8 emphasizes to broker-
dealers the importance of having adequate systems capacity
to handle high volume or high volatility trading days.

     Staff Legal Bulletin No. 8 represents staff views.  It
is not a rule, regulation or Commission statement and the
Commission has neither approved nor disapproved its content.

     For further information concerning the bulletin,
contact John Heine at (202) 942-0020, or see

http://www.sec.gov/rules/othern/slbmr8.htm

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