Rule 10b-10 under the Securities
Exchange Act of 1934 ("Exchange Act") requires broker-dealers to
disclose basic trade information to customers regarding their
securities transactions. The information required by Rule 10b-10
includes: the date and time of the transaction, the identity and
number of shares bought or sold, and the trading capacity of the
broker-dealer. In addition, depending on the trading capacity of
the broker-dealer, the Rule requires the disclosure of commissions
and, under specified circumstances, mark-up and mark-down
information. For transactions in debt securities (other than U.S.
savings bonds and municipal securities) the Rule requires the
disclosure of redemption and yield information. For transactions in
securities futures products in a futures account, the Rule permits
alternative information disclosure requirements. This alternative
information includes, the date the transaction was executed; the
identity and number of shares bought or sold; the price, the
delivery month, and the exchange on which the transaction was
executed; the source and amount of broker remuneration; whether the
broker received payment for order flow; and, the fact that other
specified information about the execution of the transaction will
be available upon written request. Rule 10b-10 also requires
broker-dealers to inform their customers if they are not members of
the Securities Investor Protection Corporation ("SIPC"). The
purpose of this disclosure is to ensure that customers are not led
to believe that their accounts are subject to SIPC protection when
they are not. In addition, the Rule requires broker-dealers to
state on confirmations whether they receive payment for order flow.
The confirmation has become a customary tool in the industry, and
it serves several functions: firms use it as a billing statement;
it serves as a customer invoice; it informs investors of the
details of a transaction allowing the customer to check for errors
or misunderstandings; it provides consumer information, allowing
investors to evaluate the cost and quality of the services provided
by broker-dealers; it discloses possible conflict of interest that
may arise between the investor and broker-dealer; and it safeguards
against fraud, by permitting the customer to detect problems
associated with a transaction.
US Code:
15
USC 78a Name of Law: Securities and Exchange Act of 1934
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.
DGL REVISED 2013 10b-10 SS.pdf
Electronic Confirmation of Securities Transactions (17 C.F.R. 240.10b-10)