SEC Adopts New Financial Responsibility and Reporting Requirements for US-Registered Broker-Dealers

August 28, 2013

The Securities and Exchange Commission (“SEC” or “Commission”) recently approved amendments to its net capital, customer protection, books and records, notification and reporting requirements for broker-dealers, in an effort to enhance financial responsibility and investor asset safekeeping obligations.1 Several of the amendments codify long-standing SEC staff interpretations of the rules and accounting standards that govern these requirements. As discussed in greater detail below, some of the amendments are applicable only to firms that carry customer accounts on their books (commonly referred to as “carrying brokers”), while other amendments also apply to limited-purpose broker-dealers that do not carry customer accounts on their books. The amendments that were approved have different effective dates, commencing in October 2013.

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