SEC Rule 15c2-5 Information Collection Extension for Broker-Dealer Loan Disclosures
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The U.S. Securities and Exchange Commission is seeking OMB approval to extend the information collection requirements under Rule 15c2-5 of the Securities Exchange Act of 1934. This rule prohibits broker-dealers from arranging or extending certain loans to customers in connection with securities transactions unless they first provide a written statement detailing the customer's obligations, risks, disadvantages, and all commissions or remuneration involved. Broker-dealers must also obtain financial information from the customer, determine that the transaction is suitable, and retain a written explanation of their suitability determination. The SEC estimates 50 broker-dealers will make 300 responses annually, requiring a total of 600 burden hours and approximately $53,400 in internal compliance costs at $89 per hour. Records must be kept for at least six years under Rule 17a-4(c).
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Key Changes
- Extension of OMB Control No. 3235-0198 for Rule 15c2-5
- 50 registered broker-dealers estimated as respondents
- 300 total annual responses (6 per respondent)
+ 3 more changes with Pro