Document ID: SEC-2009-1717-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Financial Industry Regulatory Authority, Inc.
Posted Date: 2009-12-07T05:00Z

[Federal Register: December 7, 2009 (Volume 74, Number 233)]
[Notices]               
[Page 64109-64110]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07de09-935]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61071; File No. SR-FINRA-2009-067]

 
Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Order Appoving Proposed Rule Change To Adopt FINRA 
Rules 2060 (Use of Information Obtained in Fiduciary Capacity) and 5290 
(Order Entry and Execution Practices) in the Consolidated FINRA 
Rulebook

November 30, 2009.
    On October 6, 2009, the Financial Industry Regulatory Authority, 
Inc. (``FINRA'') (f/k/a National Association of Securities Dealers, 
Inc. (``NASD'')) filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to adopt NASD Rules 3120 (Use of Information 
Obtained in Fiduciary Capacity) and 3380 (Order Entry and Execution 
Practices) as FINRA rules in the consolidated FINRA rulebook without 
material change. The proposed rule change would renumber NASD Rule 3120 
as FINRA Rule 2060 and NASD Rule 3380 as FINRA Rule 5290 in the 
consolidated FINRA rulebook. The proposed rule change was published for 
comment in the Federal Register on October 28, 2009.\3\ The Commission 
received no comments on the proposal. This order approves the proposed 
rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 60850 (October 21, 
2009), 74 FR 55598.
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    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities association.\4\ In 
particular, the Commission finds that the proposed rule change is 
consistent with the provisions of Section 15A(b)(6) of the Act,\5\ 
which requires, among other things, that FINRA rules be designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade, and, in general, to protect 
investors and the public interest.
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    \4\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition and capital 
formation. See 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78o-3(b)(6).
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    The Commission believes that the proposed rule change is 
appropriate to continue to prohibit members who, in

[[Page 64110]]

the capacity of a paying agent, transfer agent, trustee, or in any 
other similar capacity, have received information as to the ownership 
of securities, from using such information for the purpose of 
soliciting purchases, sales or exchanges except at the request and on 
behalf of the issuer. The Commission also believes that the proposed 
rule change is appropriate to continue to prohibit conduct that has the 
intent or effect of splitting orders into multiple smaller orders for 
execution or any execution into multiple smaller executions for 
transaction reporting for the primary purpose of maximizing a monetary 
or in-kind amount to be received by the member or associated person as 
a result of the execution of such orders or the transaction reporting 
of such executions. In approving the proposed rule change, the 
Commission notes that FINRA is adopting NASD Rules 3120 and 3380 as 
FINRA rules in the consolidated FINRA rulebook without material 
changes.
    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\6\ that the proposed rule change (SR-FINRA-2009-067) be, and it 
hereby is, approved.
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    \6\ 15 U.S.C. 78s(b)(2).

For the Commission, by the Division of Trading and Markets, pursuant 
to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-29038 Filed 12-4-09; 8:45 am]

BILLING CODE 8011-01-P