Document ID: SEC-2012-0353-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Midwest Clearing Corp.
Posted Date: 2012-03-02T05:00Z

[Federal Register Volume 77, Number 42 (Friday, March 2, 2012)]
[Notices]
[Page 12896]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-5054]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66458; File No. 600-9]

Self-Regulatory Organizations; Midwest Clearing Corporation; 
Order Cancelling Clearing Agency Registration

February 24, 2012.

I. Background

    On December 1, 1975, pursuant to Sections 17A(b) and 19(a)(1) of 
the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 17Ab2-1 
thereunder,\2\ the Securities and Exchange Commission (``Commission'') 
approved on a temporary basis the application for registration as a 
clearing agency filed by the Midwest Clearing Corporation (``MCC'').\3\ 
By subsequent orders, the Commission extended MCC's temporary 
registration.\4\ On September 23, 1983, pursuant to Section 17A and 
Rule 17Ab2-1 thereunder,\5\ the Commission approved on a permanent 
basis MCC's registration as a clearing agency.\6\
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    \1\ 15 U.S.C. 78q-1(b) and 78s(a)(1).
    \2\ 17 CFR 240.17Ab2-1.
    \3\ Release No. 34-11875 (Nov. 26, 1975), 40 FR 55910 (Dec. 2, 
1975).
    \4\ Release Nos. 34-1358 (June 1, 1977), 42 FR 30066 (Jun. 10, 
1977); 34-13911 (Aug. 31, 1977), 1977 WL 190688; 34-14531, 43 FR 
10288 (Mar. 10, 1978); and 34-18584 (March 22, 1982), 47 FR 13266 
(Mar. 29, 1982).
    \5\ 15 U.S.C. 78q-1 and 17 CFR 240.17Ab2-1.
    \6\ Release No. 34-20221, 48 FR 45167 (Oct. 3, 1983).
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    MCC was a subsidiary of The Chicago Stock Exchange, Incorporated 
(``CHX'') \7\ and provided trade recording, comparison, clearance, and 
settlement services to its participants.\8\
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    \7\ Letter from David C. Whitcomb Jr., General Counsel, Chicago 
Stock Exchange, to David Karasik, Division of Trading and Markets 
(Oct. 28, 2009) (``CHX 2009 Letter'').
    \8\ Release No. 34-20221, supra note 6.
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II. Cancellation of MCC's Registration as a Clearing Agency

    In a letter dated October 28, 2009, CHX notified the Commission 
that MCC was no longer in operation and therefore had ceased to do 
business in the capacity specified in its application for 
registration.\9\ CHX also indicated that, given the time elapsed since 
MCC ceased active operations, it did not anticipate any future claims 
against MCC or itself.\10\
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    \9\ CHX 2009 Letter. MCC was incorporated in Delaware on 
September 21, 1973, and was dissolved on December 17, 2009. 
LexisNexis, Public Records, Corporate Filings search (http://www.lexis.com) and Secretary of State of the State of Delaware 
(http://corp.delaware.gov/authver.shtml). CHX believes that MCC's 
clearing agency operations had ceased by late 1995. Email from James 
G. Ongeena, Vice President and Associate General Counsel, CSX, to 
David Karasik, Division of Trading and Markets, Commission (Aug. 18, 
2011) (providing a copy of a Transfer Agreement dated as of November 
14, 1995, by and among CSX, Midwest Securities Trust Company 
(``MSTC''), MCC, The Depository Trust Company(``DTC''), and National 
Securities Clearing Corporation (``NSCC'') wherein MCC and MSTC 
agreed to, among other things, transfer MCC and MSTC's clearing and 
depository services and related assets and obligations including 
participants' open positions to DTC and NSCC).
    \10\ CHX 2009 Letter. In addition, CHX represented to the 
Commission that as of August 16, 2011, CHX had not, to the best of 
its knowledge, received any claims against or document requests 
regarding MSTC within the last two years. Email from James G. 
Ongeena, Vice President and Associate General Counsel, Chicago Stock 
Exchange, to David Karasik, Division of Trading and Markets (Aug. 
16, 2011).
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    CHX also stated that ``most of the books and records relating to 
MCC are beyond the statutory retention period. Any books and records of 
duration less than the statutory requirement will be maintained in 
accordance with the CHX's standard document retention policies.'' \11\
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    \11\ CHX 2009 Letter.
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    Section 19(a)(3) of the Act provides that in the event any self-
regulatory organization is no longer in existence or has ceased to do 
business in the capacity specified in its application for registration, 
``the Commission, by order, shall cancel its registration.'' \12\
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    \12\ 15 U.S.C. 78s(a)(3).
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    Based upon the representations and undertakings made by CHX to the 
Commission and because MCC is no longer in existence and has ceased to 
do business in the capacity specified in its registration application, 
the Commission is canceling its registration effective February 24, 
2012.
    It is therefore ordered that:
    Effective February 24, 2012, based on the facts and representations 
noted above, MCC's registration as a clearing agency under Section 17A 
of the Exchange Act and Rule 17Ab2-1 thereunder is cancelled.

    By the Commission.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-5054 Filed 3-1-12; 8:45 am]
BILLING CODE 8011-01-P