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U.S. Securities and Exchange Commission

Final Rule:
Delegation of Authority to the General Counsel of the Commission


17 CFR PART 200

[Release No. 34-46418]

Delegation of Authority to the General Counsel of the Commission

AGENCY: Securities and Exchange Commission

ACTION: Final rule

SUMMARY: The Securities and Exchange Commission ("Commission") is amending its rules to delegate authority to the General Counsel to issue orders raising in any Commission-instituted proceeding the matter of whether any sanction, and if so what sanction, should be imposed in the public interest. This delegation is intended to conserve Commission resources, as well as expedite the resolution of reviews of those proceedings.

EFFECTIVE DATE: September 3, 2002

FOR FURTHER INFORMATION CONTACT: Joan Loizeaux, Office of the General Counsel, at (202) 942-0990, Securities and Exchange Commission, 450 5th Street, NW, Washington, DC 20549-0208.


The Commission today is amending its rules governing delegation of authority to the General Counsel. The Securities Act of 1933,1 Securities Exchange Act of 1934,2 InvestmentAdvisers Act of 1940,3 the Investment Company Act of 1940,4 the Securities Investor Protection Act of 1970,5 and Rule of Practice 102(e)6 authorize the Commission to institute administrative proceedings, which, under appropriate circumstances, can result in the imposition of sanctions. The Commission wishes to provide prompt notice to the parties that it may review sanctions imposed in initial decisions in such proceedings with a view to making an independent assessment of what sanctions, if any, are in the public interest.

Commission Rule of Practice 411(d)7 authorizes the Commission, prior to the issuance of a decision, to raise and determine any matters that it deems material. The Commission therefore is amending its rules to delegate to the General Counsel the authority to issue orders, pursuant to Rule of Practice 411(d), that would take up the issue of whether any sanction, and if so what sanction, is appropriate in the public interest. In any case in which the General Counsel believes it appropriate, he or she may submit the matter to the Commission for consideration.

Administrative Law Matters

The Commission finds, in accordance with Section 533(b)(A) of the Administrative Procedure Act, 5 U.S.C. 553(b)(A), that this amendment relates solely to agency organization, procedure, or practice. Accordingly, notice and opportunity for public comment, as well as publication 30 days before its effective date, are unnecessary. Because notice and comment are not required for this final rule, a regulatory flexibility analysis is not required under the Regulatory Flexibility Act.8

The rule does not contain any collection of information requirements as defined by the Paperwork Reduction Act of 1995, as amended.9 The rule will not impose any costs on the public.

List of Subjects in 17 CFR Part 200

Administrative practice and procedure, Authority delegations

(Government agencies).

Text of the Amendment

For the reasons set out in the preamble, Title 17, Chapter II of the Code of Federal Regulations is amended as follows:

Part 200 -- Organization; Conduct and Ethics; and Information and Requests

1. The authority citation for Part 200, Subpart A, continues to read in part as follows:

Authority: 15 U.S.C. 77s, 78d-1, 78d-2, 78w, 78ll(d), 78mm, 79t, 77sss, 80a-37, 80b-11, unless otherwise noted.

* * * * *

2. Section 200.30-14 is amended by adding paragraph (g)(1)(xv) to read as follows:

§200.30-14. Delegation of authority to the General Counsel.

* * * * *

(g)(1) * * *

(xv) To issue an order raising, pursuant to the provisions of Rule 411(d) of the Commission's Rules of Practice, §201.411(d) of this chapter, any matter relating to whether any sanction, and if so what sanction, is in the public interest.

* * * * *

By the Commission.

Margaret H. McFarland
Deputy Secretary

Date: August 27, 2002

1 15 U.S.C. 77a, et seq.
2 15 U.S.C. 78a, et seq.
3 15 U.S.C. 80b-1, et seq.
4 15 U.S.C. 80a-1, et seq.
5 15 U.S.C. 78aaa, et seq.
6 17 CFR 201.102(e).
7 17 CFR 201.411(d).
8 See 5 U.S.C. 603.
9 44 U.S.C. 3501 et seq.



Modified: 09/04/2002