3235-0033 Supporting Statement (Rule 17a-3--Partial Revision 2021)

Supporting Statement
for the Paperwork Reduction Act Information Collection Submission for
Rule 17a-3
OMB Control No. 3235-0033
Partial Revision
A.
1.

JUSTIFICATION
Information Collection Necessity

All brokers and dealers in the ordinary course of their businesses need to maintain certain
books and records reflecting, among other things, income and expenses, assets and liabilities, daily
trading activity and the status of customer and firm accounts. These books and records are,for the
most part, standard and would be kept by any prudent individual engaging in a securities business.
The Securities and Exchange Commission (“Commission” or “SEC”) is statutorily
authorized by Sections 17(a) 1 and 23(a) 2 of the Securities Exchange Act of 1934 (“Exchange
Act”) to promulgate rules and regulations regarding the maintenance and preservation of books
and records of exchange members, brokers and dealers (“broker-dealers”). Exchange Act Section
17(a)(1) provides in pertinent part:
“[all members of a national securities exchange and registered brokers and dealers] shall
make and keep for prescribed periods such records...as the Commission, by rule, prescribes as
necessary or appropriate in the public interest, for the protection of investors, or otherwise in
furtherance of the purposes of the [Exchange Act].”
To standardize recordkeeping practices throughout the industry, the Commission, in 1939,
adopted Rule 17a-3, 3 which established minimum standards with respect to business records that
broker-dealers must create. 4 Rule 17a-3 requires broker-dealers to make and keepcurrent certain
records relating to their financial condition, communications, customer information, and
employees.
The Commission adopted certain Amendments to Rule 17a-3 on October 25, 2001 (the
“2001 Amendments”), in part as a response to the National Securities Market Improvement Actof
1996 ("NSMIA"). 5 NSMIA prohibits any State from establishing books and records rules for
broker-dealers that differ from, or are in addition to, the Commission's rules, and also requires the
Commission to consult periodically with the States concerning the adequacy of the Commission’s
books and records rules. 6 The 2001 Amendments expanded the types of records that broker-dealers
must create to include additional records necessary for State examiners to review for sales practice
violations at office locations, and were designed to assist regulators, particularly State securities
1

15 U.S.C. § 78q(a).

2

15 U.S.C. § 78w(a).

3

17 CFR 240.17a-3.

4

Exchange Act Release No. 2304 (Nov. 13, 1939).

5

Pub.L.No. 104-290, 110 Stat. 3416 (1996).

6

Exchange Act Section 15(h), 15 U.S.C. § 78o(h).

regulators, in conducting effective examinations. 7
Partial Revision to Collection of Information
As discussed further below, the Commission adopted amendments to Rule 17a-3 in 2019
pursuant to authority in the Dodd-Frank Act. The 2019 amendments are not required to be complied
with until October 6, 2021 and this partial revision provides new or updated burden estimates in
connection with the 2019 rule amendments. Only hour burdens have been revised. Cost burdens
remain unchanged with the 2019 amendments.
On July 21, 2010, President Obama signed the Dodd-Frank Act into law. 8 Title VII of the
Dodd-Frank Act (“Title VII”) established a new regulatory framework for the over-the-counter
derivatives markets.9 Title VII was enacted, among other reasons, to provide for the registration and
regulation of security-based swap dealers (“SBSDs”) and major security-based swap participants
(“MSBSPs”), and create recordkeeping and reporting regimes for such entities. Section 764 of the
Dodd-Frank Act added Section 15F to the Exchange Act, which directs the Commission to adopt
rules governing reporting and recordkeeping for SBSDs and MSBSPs. 10 Additionally, Section
17(a)(1) of the Securities Exchange Act of 1934 provides the Commission with authority to adopt
rules requiring broker-dealers – which would include broker-dealer security-based swap dealers
(“broker-dealer SBSDs”) and broker-dealer major security-based swap participants (“broker-dealer
MSBSPs”) – to make and keep for prescribed periods such records, furnish such copies thereof, and
make and disseminate such reports as the Commission, by rule, prescribes as necessary or appropriate
in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the
Exchange Act. 11
Accordingly, the Commission, on September 19, 2019, amended its recordkeeping
requirements for broker-dealers in Rule 17a-3 to implement the new recordkeeping requirements
mandated under the Dodd-Frank Act for broker-dealer SBSDs and broker-dealer MSBSPs, and to
account for the security-based swap and swap activities of stand-alone broker-dealers. 12
These amendments to Rule 17a-3 revise a number of existing collections of information, and
establish a number of new collections of information. Specifically, existing Rule 17a-3 has been
amended to include a new introductory paragraph indicating which entities will be subject to the rule,
clarifying that the rule will now also apply to broker-dealer SBSDs and broker-dealer MSBSPs. This
Supporting Statement addresses the estimated changes in burdens and costs associated with these
7

See Exchange Act Release No. 37850 (October 22, 1996), 61 FR 55593 (October 28, 1996) (“Proposing
Release”).

8

See Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Pub. L. 111–203, 124 Stat. 1376
(2010).

9

Pursuant to section 701 of the Dodd-Frank Act, Title VII may be cited as the “Wall Street Transparency and
Accountability Act of 2010.” See Pub. L. 111–203, 701.

10

See 15 U.S.C. 78o-10(f)(2).

11

See 15 U.S.C. 78q(a)(1).

12

See Recordkeeping and Reporting Requirements for Security-Based Swap Dealers, Major Security-Based Swap
Participants, and Broker-Dealers; Final Rules, Exchange Act Release No. 34-87005(Sep. 19, 2019), 84 FR
68550 (Dec. 16, 2019).

amendments. 13
In October 2019, the Commission requested extension of the estimated burdens that had
previously been approved. 14 That extension request did not include the estimated burdens associated
with the amendments to Rule 17a-3 that were adopted in September 2019. The extension request was
approved in December 2019.
This Supporting Statement addresses the estimated burdens associated with the
amendments to Rule 17a-3 that were adopted in September 2019.
2.

Information Collection Purpose and Use

The purpose of requiring broker-dealers, broker-dealer SBSDs, and broker-dealer MSBSPs
to create the records specified in Rule 17a-3 is to enhance regulators’ ability to protect investors.
These records and the information contained therein will be and are used by examiners and other
representatives of the Commission, State securities regulatory authorities, and the self-regulatory
organizations (e.g., FINRA, CBOE, etc.)(“SROs”) to determine whether broker-dealers, brokerdealer SBSDs, and broker-dealer MSBSPs are in compliance with the Commission’s antifraud and
anti-manipulation rules, financial responsibility program, and other Commission, SRO, and State
laws, rules, and regulations.
If broker-dealers, broker-dealer SBSDs, and broker-dealer MSBSPs were not required to
create these records, Commission, SRO, and state examiners would be unable to conduct effective
and efficient examinations to determine whetherbroker-dealers were complying with relevant laws,
rules, and regulations.
3.

Consideration Given to Information Technology

The Commission believes that improvements in telecommunications and data processing
technology may reduce any burdens that result from Rule 17a-3. Broker-dealers are not prevented
by Rule 17a-3 from using computers or other mechanical devices to generate the records required
under the Rule.
4.

Duplication

13

On June 5, 2019, the Commission adopted Rule 151-1 under the Securities Exchange Act of 1934 (“Exchange
Act”) establishing a standard of conduct for broker-dealers and natural persons who are associated persons of a
broker-dealer (unless otherwise indicated, together referred to as “broker-dealer” or “BD”) when making a
recommendation of any securities transaction or investment strategy involving securities to a retail customer
(“Regulation Best Interest”). See Securities Exchange Act Release No. 86031 (Jun. 5, 2019), 84 FR 33669 (July
12, 2019); see also Securities Exchange Act Release No. 83062 (Apr. 18, 2018) [83 FR 21574] (May 9, 2018)
(“Regulation Best Interest Adopting Release”). At the same time,the Commission adopted Exchange Act Rule
17a-14 (CFR 240.17a-14) and Form CRS (17 CFR 249.640) under the Exchange Act. See Form CRS
Relationship Summary; Amendments to Form ADV Exchange Act Release No. 86032, Advisers Act Release No.
5247, File No. S7-08-18 (June 5, 2019), 84 FR 33492 (July 12, 2019). See also Release No. 34-83063, IA-4888,
File No. S7-08-18 (Apr. 18, 2018), 83 FR 23848 (May 23, 2018). As part of new Rule 17a-14 and Form CRS
and Regulation Best Interest, the Commission recently amended Rule 17a-3 by adding new paragraphs (a)(24)
and (a)(35), respectively.

14

See https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201910-3235-003.

Rule 17a-3 was drafted and amended to codify SRO record-keeping requirements and therecordkeeping practices of prudent broker-dealers. Because most broker-dealers already create many of
the records required by Rule 17a-3 either voluntarily or pursuant to SRO requirements,no
duplication of such information is apparent.
5.

Effect on Small Entities 15

The books and records required under Rule 17a-3 are normally created by small brokerdealers. Since small broker-dealers utilize processes that are more manual in nature, while large
broker-dealers use more automated processes, the Commission has estimated some of the time
factors for small broker-dealers to be higher, as described below.
With respect to the amendments associated with the rulemaking implementing the
recordkeeping requirements mandated under the Dodd-Frank Act with respect to broker-dealer
SBSDs and broker-dealer MSBSPs, and to account for the security-based swap and swap
activities of stand-alone broker-dealers, the Commission does not anticipate that the amendments
will have any impact on small broker-dealers as most of these firms generally do not hold
positions in security-based swaps.
6.

Consequences of Not Conducting Collection

The information required to be collected and recorded under Rule 17a-3 allows the
Commission, State securities regulatory authorities, and the SROs to determine whether brokerdealers, broker-dealer SBSDs, and broker-dealer MSBSPs are in compliance with Commission,
State, and SRO anti-fraud and anti-manipulation rules, financial responsibility rules, and other
rules and regulations. If a broker-dealer does not make these records, or it makes these records less
frequently, the level of investor protection will be reduced. The records broker-dealers, brokerdealer SBSDs and broker-dealer MSBSPs are required to make under Rule 17a-3 are, for the most
part, essential to the successful operation of a securities firm, and failure to make the records on a
current basis would likely cause the broker-dealer, broker-dealer SBSDs or broker-dealer MSBSPs
to experience operational difficulties.
7.

Inconsistencies with Guidelines in 5 CFR 1320.5(d)(2)

There are no special circumstances. This collection is consistent with the guidelines inwith
5 CFR 1320.5(d)(2).
8.

Consultations Outside the Agency

The Commission requested comment on the collection of information requirements when
the 2019 amendments were proposed in April 2014. 16 The Commission received no comments
15

16

Section 601(b) of the Regulatory Flexibility Act (“RFA”) defines the term “small entity.” The statute, however,
permits agencies to formulate their own definitions. The Commission has adopted definitions for the term “small
entity” for the purposes of Commission rulemaking in accordance with the RFA. Those definitions, as relevant
to this rulemaking, are set forth in 17 CFR 240.0-10. See Statement of Management on Internal Accounting
Control, Exchange Act Release No. 18451 (Jan. 28, 1982), 47 FR 5215 (Feb. 4, 1982).
See Recordkeeping and Reporting Requirements for Security-Based Swap Dealers, Major Security-Based Swap
Participants, and Broker-Dealers; Capital Rule for Certain Security-Based Swap Dealers; Proposed Rule,
Exchange Act Release No. 71958 (Apr. 17, 2014), 79 FR 25193 (May 2, 2014).

regarding the Paperwork Reduction Act burden and cost estimates. The proposed revisions to the
collection of information was submitted to OMB in 2016 (ICR Ref. No. 201603-3235-004).
9.

Payment or Gift

No gifts or payments will be given to respondents.
10.

Confidentiality

The records required by Rule 17a-3 are available only to the examination staffs of the
Commission, State regulatory authorities, and the SROs. Subject to the provisions of the
Freedom of Information Act, 5 U.S.C. § 552 (“FOIA”) and the Commission’s rules thereunder
(17 CFR 200.80(b)(4)(iii)), the Commission generally does not publish or make available
information contained in reports, summaries, analyses, letters, or memoranda arising out of, in
anticipation of, or in connection with an examination or inspection of the books and records of
any person or any other investigation.
11.

Sensitive Questions

The information collection collects a broad range of PII related to an associated person of
the broker-dealer. The broker-dealer is required to maintain the information. Upon Commission
request, the information collection is manually submitted via mail and email and collected in paper
form. The primary retrieval method is broker-dealer firm name and not a personal identifier. Based
on the business practice of handling the information collection, the collection does not constitute a
system of records under the Privacy Act and does not require a PIA of the E-Government Act of
2002. However, the SEC has privacy administrative, technical, and physical controls in place to
protect the PII that the Commission requests. The information collected via email or scanned pdf
documents are stored in a database on the GSS system that is covered under the GSS Rev.2 PIA.
Notice to the public of the collection of the information and the agency’s handling practices are
described in System of Records Notice (SORN) SEC-70 “SEC’s Trading and Markets Records.”
The SEC-70 SORN, published on February 15, 2018, is provided as a supplemental document and
is also available at https://www.sec.gov/privacy.
12.

Information Collection Burden

All registered broker-dealers are subject to Rule 17a-3. Rule 17a-3 establishes certain
records that must be made by all broker-dealers, while other records must be made only by certain
broker-dealers. All of these burdens are recordkeeping burdens.
Currently Approved Burdens
This section summarizes the burdens that have been reviewed and approved.
As of December 31, 2018, there were 3,764 broker-dealers registered with the Commission.The
Commission estimates that the aggregate hour burden of the requirements associated with Rule17a-3
is approximately 5,317,241 hours, calculated as follows:
Records to be Made by All Broker-Dealers

Rule 17a-3 - Records to be made by certain exchange members, brokers and dealers
While recordkeeping requirements will vary based on the size and complexity of the brokerdealer, the Commission estimates that one hour a day is the average amount of time needed by a
broker-dealer to comply with the overall requirements of Rule 17a-3, in addition to the separate
burdens described below. The number of working days per year is 249, and as a result the total
estimated burden for broker-dealers with respect to Rule 17a-3 generally is 937,236 hours per
year. 17 These hours are recordkeeping burdens.
Rule 17a-3(a)(12, 19)
In addition to the hour burden estimate for Rule 17a-3 generally, the Commission also believes
that paragraphs (a)(12) and (19) of Rule 17a-3 will impose specific burdens on broker-dealers.
Paragraphs (a)(12) and (a)(19) of Rule 17a-3 require that a broker-dealer create certainrecords
regarding its associated persons. 18 The Commission estimates that each broker-dealer spends, on
average, approximately 30 minutes each year to ensure that it is in compliance with these
requirements, resulting in a total annual compliance burden of about 1,882 hours. 19 These
hours are recordkeeping burdens.
Rule 17a-3(a)(20-22)
Paragraphs (a)(20)–(22) of Rule 17a-3 require broker-dealers to make, among other things,
records documenting the broker-dealer’s compliance, or that the broker-dealer has adopted policies
and procedures reasonably designed to establish compliance, with applicable federal regulations
and SRO rules that require approval by a principal of the broker-dealer of anyadvertisements, sales
literature or other communications with the public. Moreover, these rules require broker-dealers to
create a record of the personnel responsible for establishing compliancepolicies and procedures
and of the personnel capable of explaining the types of records the broker-dealer. 20 The
Commission estimates that, on average, each broker-dealer will spend 10 minutes each year to
ensure compliance with these requirements, yielding a total burden of about 627 hours. 21 These
are recordkeeping burdens.
Rule 17a-3(a)(17)
Estimating the paperwork burden associated with paragraph (a)(17) requires a more
complicated formula to calculate the compliance burden because it is based on the number of
17

3,764 (the number of broker-dealers as of December 31, 2018) multiplied by 1 hour per day multiplied by249
working days equals 937,236 hours.

18

These records that a broker-dealer is required to make regarding the broker-dealer’s associated persons include:
1) all agreements pertaining to the associated person’s relationship with the broker-dealer and a summary of each
associated person’s compensation arrangement (17 CFR 240.17a-3(a)(19)(ii)), 2) a recorddelineating all
identification numbers relating to each associated person (17 CFR 240.17a-3(a)(12)(ii)), 3) arecord of the office
at which each associated person regularly conducts business (17 CFR 240.17a- 3(a)(12)(iii)), and 4) a record as
to each associated person listing transactions for which that person will be compensated (17 CFR 240.17a3(a)(19)(i)).

19

(3,764 broker-dealers x 30 minutes) / 60 minutes.

20

17 CFR 240.17a-3(a)(20); 17 CFR 240.17a-3(a)(21); and 17 CFR 240.17a-3(a)(22).

21

(3,764 broker-dealers x 10 minutes) / 60 minutes.

customer accounts for which a broker-dealer must collect this information as opposed to the
number of broker-dealers. In addition, the Commission understands that large broker-dealers
have more automated processes to collect and create these records than smaller broker-dealers,
and has factored this into its estimates.
As of the end of 2018, 3,764 registered broker-dealers that filed the FOCUS Schedule I
Reports on December 31, 2018 reported that they maintained a total of 143,333,278 customer
accounts. Forty-five (45) of those broker-dealers reported that they maintained over 100,000
accounts each (for purposes of this Supporting Statement, the “Large Broker-Dealers”), and the
remaining 3,719 broker-dealers maintained less than 100,000 customer accounts each (for purposes
of this Supporting Statement, the “Small Broker-Dealers”). The Large Broker-Dealers reported that
they held a total of 142,049,978 customer accounts (or 99% of the total customer accounts
reported), with the Small Broker-Dealers holding the remaining 1,283,300 customer accounts (or
1% of the total customer accounts reported). The Commission estimates that approximately 27.7%
of the 143,333.278 total customer accounts would be excluded from the provisions of 17a-3(a)(17)
because the accounts are either (i) not accounts of natural persons, (ii) inactive, or (iii) accounts for
which the broker-dealer does not have a suitability requirement. 22 Accordingly, the total number of
active customer accounts regarding which broker-dealers wouldneed to provide customers with
account information is approximately 103,629,960 (102,593,660,or 99%, held by Large BrokerDealers and 1,036,300, or 1%, held by Small Broker-Dealers).
Rule 17a-3(a)(17)(i)(B)(1) – Large BD; and Rule 17a-3(a)(17)(i)(B)(1) – Small BD
The Commission estimates that broker-dealers will be required to provide customer account
information to approximately 34,543,320 customers per year to comply with paragraph
(a)(17)(i)(B)(1). 23 Approximately 34,197,887 will be customers of Large Broker-Dealers, 24 and
approximately 345,433 will be customers of Small Broker-Dealers. 25 Further, the Commission
estimates that this will take Large Broker-Dealers an average of 1½ minutes per account, or a total
of 854,947 hours per year for all Large Broker-Dealers, 26 and that it will take Small BrokerDealers an average of 7 minutes per account, or a total of 40,301 hours per year for all Small
Broker-Dealers. 27 Thus, the estimated total burden on the industry to comply with the paragraph
(a)(17)(i)(B)(1) requirement to provide account information to customers when an account is
opened and periodically thereafter is 895,248 hours per year. 28 These hours are recordkeeping and
third party disclosure burdens, with an assumption that the burden is split evenly between thetwo
22

See Rule 17 CFR 240.17a-3(a)(17)(i)(D). The Commission arrived at this number using estimates providedby the
firms (in their comment letters and otherwise) as to how many of their accounts would fit in to one or more of
these categories.

23

(103,629,960 x (1 every 3 years), or, in other words, (103,629,960 / 3) because the broker-dealer must sendeach
customer a copy of his or her account record information once every three years.

24

34,543,320 account records x 99% = 34,197,887 account records, or 759,953.0444 account records perLarge
Broker-dealer (34,197,887 account records / 45).

25

34,543,320 account records x 1% = 345,433, or approximately 93 account records per Small Broker-dealer
(345,433 / 3,719).

26

(34,197,887 x 1.5 minutes / 60 minutes) = 854,947 hours per year.

27

(345,433 x 7 minutes / 60 minutes) = 40,301 hours per year.

28

(854,947 hours + 40,301 hours) = 895,248 hours.

burden types.
Rule 17a-3(a)(17)(i)(B)(2) + (3) – Large BD; and Rule 17a-3(a)(17)(i)(B)(2) + (3) –
Small BD
If a customer provides a broker-dealer with updated account record information, the broker-dealer
must, pursuant to paragraphs (a)(17)(i)(B)(2) and (3), update the customer’s account information
and send the revised account information to the customer to verify its accuracy. 29 The Commission
estimates that approximately 20% of the customers from whom information is requested will
update their account records, resulting in 6,908,664 updated account records each year. 30 In
addition, the Commission estimates that 5% of active customeraccounts, or 5,181,498, 31 will
initiate changes to their account records on a yearly basis, just as they do now, with no prompting
from any account record mailing. The total number of updates, therefore, will be approximately
12,090,162. 32 The Commission estimates that it would take, on average, 5 minutes for Large
Broker-Dealers to update each account and 10 minutes 33 for Small Broker-Dealers to update each
account, resulting in an additional aggregate burden of 1,017,660 hours per year (997,518 for all
Large Broker-Dealers and 20,142 for all Small Broker-Dealers) toupdate account record
information and provide the new account information to customers as required by paragraphs
(a)(17)(i)(B)(2) and (3). 34 These hours are recordkeeping and third party disclosure burdens, with
an assumption that the burden is split evenly between the two burden types.
Rule 17a-3(a)(23) Part I
Paragraph (a)(23) of Rule 17a-3, requires certain broker-dealers to make and keep currenta
record documenting credit, market, and liquidity risk management controls established and
maintained by the broker-dealer to assist it in analyzing and managing the risks associated with its
business activities. The Commission estimates that a broker-dealer spends, on average,
approximately 100 hours of employee resources to comply with this requirement to ensure its
market, credit, and liquidity risk controls are documented. Based on FOCUS Report data, as of
December 31, 2015, the Commission estimates there are approximately 456 broker-dealers that are
subject to paragraph (a)(23). 35 Therefore, the Commission estimates that the total one-time
recordkeeping burden to all broker-dealers will be approximately 45,600 hours, or 15,200 hours

29

17 CFR 240.17a-3(a)(17)(B)(2) and (3).

30

(34,543,320 x 20%) = 6,908,664.

31

(103,629,960 x 5%) = 5,181,498.
(6,908,664 + 5,181,498) = 12,090,162.

32
33

This estimate takes into account the 1½ and 7 minutes it would take Large and Small Broker-dealers,
respectively, to provide this updated account information to customers, and the 3.5 minutes and 3 minutes it would
take Large and Small Broker-dealers, respectively, to receive the returned data and input any changes into the
account record. The estimated total minutes for updating and providing this information tocustomers of 5
minutes for Large Broker-dealers and 10 minutes for Small Broker-dealers were taken from a comment letter to
the 2001 Amendments.

34

((12,090,162 account records x 99%) x (5 minutes / 60 minutes)) + ((12,090,162 account records x 1%) x(10
minutes / 60 minutes)).

35

This estimate is based on the number of firms that have $1,000,000 in credits or $20,000,000 in capital asof
December 31, 2018.

amortized over three years. 36
Rule 17a-3(a)(23) Part II
In addition to the one-time hour burden, based on similar collections of information
requiring the documentation of risk management controls, broker-dealers required to comply with
paragraph (a)(23) likely will incur annual hour burdens. 37 The Commission estimates that a
broker-dealer spends approximately 45 hours per year to ensure its compliance with Paragraph
(a)(23), for a total annual recordkeeping burden on the industry of 20,520 hours. 38
Rule 17a-3(a)(16)
Paragraph (a)(16) of Rule 17a-3 requires any broker-dealer that sponsors an internal brokerdealer system to make and keep current certain records relating to such system. The Commission
estimates that paragraph (a)(16) of Rule 17a-3 imposes an annual burden of 27 hours per year per
internal broker-dealer system to create the requisite records. The Commission estimates that there are
approximately 200 internal broker-dealer systems,39 resulting in a total annual recordkeeping
burden of 5,400 hours. 40
Records to be Made by Certain Broker-Dealers: Rules 17a-3(a)(24) and 17a-3(a)(35)
In June 2019, the Commission amended Rule 17a-3 by adding paragraphs (a)(24) and
(a)(35). These revisions to the collection of information were approved by OMB on October 3,
2019. Because these revisions were approved so recently, the Commission does not have any
changes to the estimated burdens for these rules; however, these burdens are summarized below as
part of the extension request for the currently approved collection in Rule 17a-3 (3235-0033).
Based on data obtained from Form BR, the Commission preliminarily believes that
approximately 73.5% of registered broker-dealers, or 2,766 broker-dealers, have retail customers
and therefore would likely be subject to Rules 17a-3(a)(24) and 17a-3(a)(35),
Rule 17a-3(a)(24):
36

456 broker-dealers x 100 hours = 45,600 hours. For purposes of this supporting statement, the one-time burden
annualized over the three year approval period is 15,200 (45,600/3), with an average hour burdenper firm of
33.33 hours (15,200/456 firms).

37

See Risk Management Controls for Brokers or Dealers with Market Access; Final Rule, Exchange Act Release
No. 63241 (Nov. 3, 2010), 75 FR 69792, 69815 (Nov. 15, 2010). See also Capital, Margin, and Segregation
Requirements for Security-Based Swap Dealers and Major Security-Based Swap Participantsand Capital
Requirements for Broker-Dealers, Exchange Act Release 68071, 77 FR at 70295 and 70297.

38

456 broker-dealers x 45 hours = 20,520 hours. The 45 per hour annual estimate is based on a similar
collection of information. See Risk Management Controls for Brokers or Dealers with Market Access;
Final Rule, Exchange Act Release No. 63241 (Nov. 3, 2010), 75 FR 69792, 69815 (Nov. 15, 2010).

39

The Commission believes that most over-the-counter (“OTC”) market makers maintain an internal broker-dealer
system. In 2010, the Commission estimated that there are approximately 200 OTC market makers responsible for
more than 1% of the trading volume in an exchange-traded security. See See Disclosure ofOrder Handling
Information, Exchange Act Release No. 84528 (Nov. 2, 2018), 83 FR 58338 (Nov. 19, 2018).

40

27 hours x 200 internal broker-dealer systems = 5,400 hours.

Rule 17a-3(a)(24) requires certain SEC-registered broker-dealers to make a record
indicating the date that a Form CRS was provided to each customer and to each prospective
customer.
The Commission estimates that it would take each broker-dealer from 0.1 hours to 0.5
hours to create the records required by paragraph (a)(24) of rule 17a-3. The incremental hour
burden forbroker-dealers to create the records required by paragraph (a)(24) of rule 17a-3 as
adopted will therefore be 1,383 hours. 41
Rule 17a-3(a)(35)
Rule 17a-3(a)(35) requires a broker-dealer to make a record of all information collected
from and provided to the retail customer pursuant to Regulation Best Interest, as well as the
identity of each natural person who is an associated person of a broker or dealer, if any, responsible
for the account. This requirement applies with respect to each retail customer to whom a
recommendation of any securities transaction or investment strategy involving securitiesis
provided. The burdens associated with each component of this rule are estimated as follows:
Rule 17a-3(a)(35): Record of Information Collected From and Provided to the Retail
CustomerPursuant to Regulation Best Interest
The Commission understands that broker-dealers currently make records of relevant
customer investment profile information, and therefore the Commission believes that no additional
record-making obligations would arise as a result of broker-dealers’ or their registered
representatives’ collection of information from retail customers. 42
Burden

Rule 17a-3(a)(35): Record of Identity of Associate Person Responsible for Account/ Firm

In addition, Rule 17a-3(a)(35) requires a broker-dealer, “for each retail customer to whom
a recommendation of any securities transaction or investment strategy involving securitiesis or will
be provided,” to make a record of the “identity of each natural person who is an associated person,
if any, responsible for the account.” The Commission assumes, for purposes of compliance with
Rule 17a-3(a)(35), that broker-dealers will need to create a record, or modifyan existing record, to
identify the associated person, if any, responsible for the account in the context of Regulation Best
Interest. For small broker-dealers, the use of outside counsel would result in a cost burden, which

41

2,766 broker-dealers x 0.5 hours annually = 1,383 annual hours for recordkeeping

42

The PRA burdens and costs arising from the requirement that a record be made of all information providedto the
retail customer are accounted for in the Regulation Best Interest Adopting Release and the Relationship
Summary Adopting Release. With respect to the requirement that a record be made of all information from the
retail customer, the Commission believes that Rule 17a-3(a)(35) would not impose any new substantive burdens
on broker-dealers. As discussed in the Regulation Best Interest Adopting Release, the Commission continues to
believe that the obligation to exercise reasonable diligence, care andskill will not require a broker-dealer to
collect additional information from the retail customer beyond that currently collected in the ordinary course of
business even though a broker-dealer’s analysis of that information and any resulting recommendation would
need to adhere to the enhanced best interest standard of Regulation Best Interest.

is discussed in Item 13 below. For large broker-dealers, 43 the Commission estimates that the initial
burden will be 2 hours for each broker-dealer (1 hour for compliance personnel and 1 hour for
legal personnel). The Commission therefore estimates the aggregate initial one-time burden for
large broker-dealers to be approximately 4,020 burden hours. 44 When annualized over three
years, this equates to approximately 1,340.67 hours, or rounded up to 1,341 hours per year.
Rule 17a-3(a)(35): Record of Identity of Associated Person Responsible for Account/
IndividualBurden
As noted above, Rule 17a-3(a)(35) requires a broker-dealer, “for each retail customer to
whom a recommendation of any securities transaction or investment strategy involving securitiesis
or will be provided,” to make a record of the “identity of each natural person who is an associated
person, if any, responsible for the account.” The Commission estimates that for the first year after
Regulation Best Interest is in effect, registered representatives associated with each of the 2,766
broker-dealer respondents will spend an additional 0.04 hours (or 0.0133333 hours per year when
annualized over three years) per each of its retail customer accounts to fill out the information in
the account disclosure document. The Commission estimates that each broker-dealer will incur this
burden for approximately 36,876 accounts per year. 45 The Commission continues to believe that
there are no ongoing costs and burdens associated with thisrecord-keeping requirement of Rule
17a-3(a)(35). As a result, the total annual estimated recordkeeping burden associated with the
Identity of Associated Person Responsible for the Account requirement is approximately
1,359,983 hours for all broker-dealer respondents. 46
Rule 17a-3(a)(35): Record of Oral Disclosure
In cases where broker-dealers choose to meet part of the Disclosure Obligation orally
under the circumstances outlined in Section II.C.1 of the Regulation Best Interest Adopting
Release, the Commission believes the requirement to maintain a record of the fact that oral
disclosure was provided to the retail customer will trigger a record-making obligation under
paragraph (a)(35) and the Commission estimates that this would take place among 52% of a
broker-dealer’s retail customer accounts (and thus 52% of a registered representative’s retail
customer accounts) annually. The Commission estimates that there are currently 102 million
customer accounts. Consequently, the Commission estimates the total burden associated with the
record of oral disclosure requirement of Rule 17a-3(a)(35) to be 1,060,761 hours per year. 47

43

The Commission estimates, for the purposes of this rule, that there are 2,010 large broker-dealers. Consequently,
the Commission estimates that the remaining 756 broker-dealers are small broker-dealers.

44

This estimate is based on the following calculation: (2 burden hours per broker-dealer) x (2,010 largebrokerdealers) = 4,020 aggregate burden hours per year.

45

For the purposes of this rule, the Commission assumes that each broker-dealer has 36,876 retail customer
accounts (i.e., (102 million retail customer accounts) / (2766 broker-dealers).

46

(2,766 broker-dealers) x (0.0133333) x (36,876 retail customer accounts) = 1,359,983 hours.

47

For the purposes of this rule, the Commission assumes that each broker-dealer has 36,876 retail customer
accounts (i.e., (102 million retail customer accounts) / (2766 broker-dealers). The Commission further assumes
that 52% of the 36,876 retail customer accounts per broker-dealer would trigger the record-makingobligation, or
(0.52 x 36,876) = 19,175 retail customer accounts per broker-dealer. Thus, the Commission estimates the burden

In summary, the aggregate annual burden attributed to Rule 17a-3, that was previously
reviewed and approved, is 5,317,241 hours (broken down as follows):
Summary of Hourly Burdens
Name of Information Collection

Type of Burden

Number of
Respondents

Annual
Responses per
Respondent

Hourly
Burden per
Response

Annual
Burden for
all
Respondents

Rule 17a-3; Records to be Made by
Certain Exchange Members, Brokers
and Dealers

Recordkeeping

3,764

249

1

937,236

Rule 17a-3(a)(12) & (19)

Recordkeeping

3,764

1

0.50

1,882

Rule 17a-3(a)(20-22)

Recordkeeping

3,764

1

0.1666

627

Rule 17a-3(a)(17)(i)(B)(1) - Large
BD

Recordkeeping &
Third Party
Disclosure

45

759,953

0.0250

854,947

Rule 17a-3(a)(17)(i)(B(1) - Small

Recordkeeping &
Third Party
Disclosure

3,719

92.88302

0.11667

40,301

Recordkeeping &
Third Party
Disclosure

45

265,983.564

0.08334

997,518

3,719

32.5092

0.1666

20,142

Small BD

Recordkeeping &
Third Party
Disclosure

Rule 17a-3(a)(23) Part I

Recordkeeping

456

1

33.334

15,200

Rule 17a-3(a)(23) Part II

Recordkeeping

456

1

45

20,520

Rule 17a-3(a)(16)

Recordkeeping

200

1

27

5,400

*Rule 17a-3(a)(24): Record of Date
Form CRS Provided to Each
Customer and Prospective Customer
(ongoing burden)

Recordkeeping

2766

1

0.5

1383

*Rule 17a-3(a)(35): Record of
Identity of Associate Person
Responsible for Account - Large
Broker-Dealers (initial one-time
burden)

Recordkeeping

2010

1

0.667

1341

*Rule 17a-3(a)(35): Record of
Identity of Associate Person
Responsible for Account/Individual

Recordkeeping

2766

36,876

0.0133333

1,359,983

BD
Rule 17a-3(a)(17)(i)(B)(2) & (3) Large BD
Rule 17a-3(a)(17)(i)(B(2) & (3) -

to be: (19,175 affected retail customer accounts) x (0.02 hours for recording each oraldisclosure relating to a
retail customer’s account) x (2,766 broker-dealers) = 1,060,761 hours.

Burden (initial one-time burden)
*Rule 17a-3(a)(35): Record of Oral
Disclosure (ongoing burden)

Recordkeeping

2766

19,175

.02

1,060.761

TOTAL

5,317,241

*These burdens were approved by OMB on October 3, 2019.
PARTIAL REVISION: New Burdens Associated with Amendments to Rule 17a-3 Related to
Security-Based Swap Activities
This section describes the estimated burdens associated with the amendments to Rule 17a-3
that were adopted in September 2019.
Security-Based Swap Activities – Paragraphs (a)(1), (a)(3), (a)(5), (a)(6), (a)(7), (a)(8),
(a)(9), (a)(26), and (a)(27): The Commission amended paragraphs (a)(1), (a)(3), (a)(5), (a)(6),
(a)(7), (a)(8), (a)(9), (a)(26), and (a)(27) of Rule 17a–3. 48 The amendments include a provision
requiring broker-dealers to make and keep current various records for security-based swaps. 49 The
Commission estimates that the amendments to paragraphs (a)(1), (a)(3), (a)(5), (a)(6), (a)(7), (a)(8),
(a)(9), (a)(26), and (a)(27) of Rule 17a–3 impose on each broker-dealer that engages in security-based
swap activities an initial burden of 70 hours in the first year and an ongoing burden of approximately
10 minutes per business day, or about 42 hours per year (including the first year). 50 The Commission
estimates that there are 42 respondents—16 broker-dealer SBSDs, 1 broker-dealer MSBSP, and 25
non-SBSD/MSBSP broker-dealers—engaged in security-based swap activities. 51 Thus, these
amendments add to the industry an estimated initial burden of 2,940 hours 52 in the first year and an
ongoing burden of 1,764 hours per year (including the first year). 53 Over a three-year period, the total
estimated industry burden is 8,232 hours, 54 or 2,744 hours per year when annualized. 55
48

See paragraphs (a)(1) (trade blotters), (a)(3) (ledgers for customer and non-customer accounts), (a)(5)(ii) (stock
record), (a)(6)(ii) (memoranda of brokerage orders), (a)(7)(ii) (memoranda of proprietary orders), (a)(8)(ii)
(confirmations), (a)(9)(iv) (accountholder information), (a)(26) (possession or control requirements under
paragraph (p) of Rule 15c3-3, as amended), and (a)(27) (customer reserve requirements under paragraph (p) of
Rule 15c3-3, as amended) of Rule 17a-3, as amended.

49

The requirements for securities other than security-based swaps largely mirror existing requirements. See
paragraphs (a)(1), (a)(3), (a)(5)(i), (a)(6)(i), (a)(7)(i), (a)(8)(i), and (a)(9)(i)-(iii) of Rule 17a-3, as amended. The
adopted requirements relating to security-based swap activity are tailored to such activity. See paragraphs (a)(1),
(a)(3), (a)(5)(ii), (a)(6)(ii), (a)(7)(ii), (a)(8)(ii), and (a)(9)(iv) of Rule 17a-3, as amended.

50

(10 minutes / 60 minutes) x (251 business days / year) = 42 hours / year. There are 251 non-weekend days in
2019. The Commission does not include U.S. public holidays in estimating the number of business days per year,
given that many broker-dealers trading security-based swaps operate internationally.

51

16 broker-dealer SBSDs + 1 broker-dealer MSBSP + 25 non-SBSD/MSBSP broker-dealers engaged in securitybased swap activities = 42 broker-dealers engaged in security-based swap activities.

52

70 hours x 42 broker-dealers = 2,940 hours.

53

42 hours x 42 broker-dealers = 1,764 hours.

54

(2,940 hours in first year + 1,764 hours in first year) + 1,764 hours in second year + 1,764 hours in third year =
8,232 hours.

55

8,232 hours / 3 years = 2,744 hours per year or 65.33 hours per respondent per year.

Broker-Dealer SBSDs and Broker-Dealer MSBSPs – Paragraphs (a)(25), (a)(28), and
(a)(30): The Commission additionally amended Rule 17a-3 to include paragraphs (a)(25), (a)(28),
and (a)(30), which requires three additional types of records to be made and kept current by brokerdealer SBSDs and broker-dealer MSBSPs. 56 The Commission estimates that paragraphs (a)(25),
(a)(28), and (a)(30) of Rule 17a–3, as amended, impose an initial burden of 60 hours per firm in the
first year and an ongoing annual burden of 75 hours per firm in each year (including the first year).
The Commission estimates that there are 17 respondents (16 broker-dealer SBSDs and 1 brokerdealer MSBSP), adding to the industry an initial burden of 1,020 hours 57 in the first year and an
ongoing burden of 1,275 hours per year (including the first year). 58 Over a three-year period, the total
industry burden is estimated to be 4,845 hours, 59 or 1,615 hours per year when annualized. 60
Broker-Dealer SBSDs Only – Paragraph (a)(29): The Commission additionally amended
Rule 17a-3 to include paragraph (a)(29) to certain records relating to political contributions to be
made and kept current by broker-dealer SBSDs. 61 The Commission estimates that paragraph (a)(29)
of Rule 17a–3, as amended, imposes an initial burden of 20 hours per firm in the first year and an
ongoing annual burden of 25 hours per firm in each year (including the first year). The Commission
estimates that there are 16 broker-dealer SBSDs, adding to the industry an initial burden of 320
hours 62 in the first year and an ongoing burden of 400 hours per year (including the first year). 63
Over a three-year period, the total industry burden is estimated to be 1,520 hours, 64 or 507 hours per
year when annualized. 65
The table below summarizes the estimated burdens associated with the amendments to Rule
17a-3 that have not been reviewed:
Summary of Hourly Burdens
A.

B.

C.

D.

E.

F.

G.

56

See Rule 17a-3, as amended (recordkeeping requirements for Rule 18a–3 calculations (paragraph (a)(25)),
unverified transactions (paragraph (a)(28)), and compliance with business conduct requirements (paragraph
(a)(30))).

57

60 hours x 17 broker-dealers = 1,020 hours.

58

75 hours x 17 broker-dealers = 1,275 hours.

59

(1,020 hours in first year + 1,275 hours in first year) + 1,275 hours in second year + 1,275 hours in third year =
4,845 hours.

60

4,845 hours / 3 years = 1,615 hours per year or 95 hours per respondent per year.

61

See paragraph (a)(29) of Rule 17a-3, as amended (political contributions).

62

20 hours x 16 broker-dealer SBSDs = 320 hours.

63

25 hours x 16 broker-dealer SBSDs = 400 hours.

64

(320 hours in first year + 400 hours in first year) + 400 hours in second year + 400 hours in third year = 1,520
hours.

65

1,520 hours / 3 years = 507 hours per year or 32 hours per respondent per year.

Name of Information
Collection

Type of
Burden

Number of
Entities
Impacted

Annual
Responses
per Entity

Initial
Burden per
Entity per
Response

Initial Burden
Annualized
per Entity per
Response

Ongoing
Burden per
Entity per
Response

[C ÷ 3 years]

Annual
Burden Per
Entity per
Response

Total Annual
Burden Per
Entity

Total Industry
Burden

[ D + E]

[F * B]

[G * A]

Small
Business
Entities
Affected

Security-based swap
activities: Paragraphs
(a)(1), (a)(3), (a)(5),
(a)(6), (a)(7), (a)(8),
(a)(9), (a)(26), and
(a)(27)

Recordkeeping

42

1

70

23.33

42

65.33

65.33

2,744

0

Broker-dealer SBSDs
and broker-dealer
MSBSPs: Paragraphs
(a)(25), (a)(28), and
(a)(30)

Recordkeeping

17

1

60

20

75

95

95

1,615

0

Broker-dealer SBSDs
only: Paragraph (a)(29)

Recordkeeping

16

1

20

7

25

32

32

507

0

TOTAL HOURLY BURDEN FOR ALL RESPONDENTS

4,866

Total Industry Hour Burden: The total industry hour burden attributable to Rule 17a-3, as
amended, is estimated to be 5,317,241 hours plus the additional 4,866 hours resulting from the
amendments to Rule 17a-3, resulting in a total industry hour burden of 5,322,107 hours.
13.

Costs to Respondents

The 2019 amendments to Rule 17a-3 associated with recordkeeping requirements for
broker-dealer SBSDs and broker-dealer MSBSPs did not result in increased costs. As a result, the
cost estimates described below have been previously reviewed and approved and are included here
for completeness.
The Commission estimates that the aggregate cost burden of the requirements associated
with Rule 17a-3 is approximately $54,448,137, calculated as follows:
Rule17a-3(a)(17) – providing updated information to customers
Ongoing operation and maintenance costs include the cost of postage to provide customers
with account information, and costs for equipment and systems development. The Commission
estimates that under Rule 17a-3(a)(17), approximately 46,633,482 customers (34,543,320 account
records 66 + 6,908,664 updated account records 67 + 5,181,498 updated account records for
customers that will initiate changes to their account records on a yearly basis,with no prompting
from any account record mailing 68) will need to be provided with informationregarding their
account on a yearly basis. Firms may include this information with other communications sent to
customers, for instance in customer account statements. In response to requests for comment
66

This figure is based on the number of active customer accounts (103,629,960) divided by 3 since the brokerdealer must send each customer a copy of his or her account record information once every threeyears.

67

This figure is based on the number of active customer accounts that receive their account record (34,543,320)
times .20, since the Commission estimates that 20% of customers that receive their accountrecord will update
their account record information.

68

This figure is based on the number of active customer accounts (103,629,960) times 0.05, since 5% of
customers update their account record information each year.

relating to the 2001 Amendments, those firms that provided estimates of postage costs indicated
that postage costs to provide customers with account record information would be about $0.244 per
item mailed. 69 However, postage costs have increased since that time. The current estimate for
postage costs is $0.35. 70 Consequently, the Commission estimates that the postage costs
associated with providing 46,633,482 customers with copies of their account record information
would be approximately $16,321,719 per year (46,633,482 x $0.35). These costs are
recordkeeping and third party disclosure burdens, with an assumptionthat the burden is split evenly
between the two burden types.
Ongoing Cost for Equipment and Systems Development
At the time of the 2001 Amendments, Large Broker-Dealers that provided cost information
estimated that their ongoing, yearly costs for equipment and systems development resulting from
Rule 17a-3 would be approximately $0.25 per customer account. The Commission believes that
the additional cost for smaller broker-dealers is included in the increased hourly burden costs
delineated above. 71 However costs for equipment and systems development have increased since
2001. Consequently, the Commission believes that the total ongoing equipment and systems
development costs relating to Rule 17a-3 for the industry would be about $37,446,686 per year
(102,593,660 active customer accounts held by the 45 Large Broker-Dealers x $0.36572), or an
annual cost burden of $832,148.57 for each of the 45 Large Broker-Dealers. This cost is a
recordkeeping burden.
Rule 17a-3(a)(23) Part 1
With respect to the amendment to paragraph (a)(23) to Rule 17a-3, a broker-dealer is required to
document its liquidity, credit, and market risk management controls, if it has established such
controls. These broker-dealers may incur one-time startup costs to hire outside counsel to review
the documented controls to ensure the broker-dealer is meeting the requirements of the rule. Based
on staff experience with similar reviews, the Commission estimates that 456 broker-dealers would
incur $2,000 in legal costs, 73 or $912,000, in the aggregate, initial one-time recordkeeping burden
to review and comment on the documented riskmanagement controls. 74 For purposes of this
supporting statement, the one-time cost of $912,000 annualized over the three-year approval
period is $304,000, 75 with an average cost perrespondent of $666.67. 76
69

See Morgan Stanley Dean Witter comment letter submitted by J. Higgins in response to the 2001Amendments;
See Merrill Lynch comment letter to the 2001 Amendments.

70

The CPI has increased by about 46% since the end of 2001. ($0.244 x 1.46) = $0.35. In addition, postagecosts
have increased. Therefore, the Commission is increasing the estimate to $0.35.

71

Smaller broker-dealers are not as automated, and their processes tend to be more manual in nature. In addition,
no smaller broker-dealers provided information regarding any increased equipment or systemsdevelopment costs
at the time of the 2001 Amendments.

72

The CPI has increased by about 46% since the end of 2001. ($0.25 x 1.46) = $0.365.

73

The Commission staff estimates that the review of the documented controls would require 5 hours of outside
counsel time at a cost of $400 per hour.

74

$2,000 x 456 broker-dealers = $912,000.

75

$912,000 / 3 years = $304,000.

76

$304,000 / 456 firms = $666.667.

Rule 17a-3(a)(35): Record of Identity of Associate Person Responsible for Account/
Firm Burden
To meet the requirement under Rule 17a-3(a)(35) to make a record of the “identity of each
natural person who is an associated person, if any, responsible for the account,” the Commission
believes that small broker-dealers will require, on average, approximately 1 hour per year for
outside legal counsel, at an updated average rate of $497/hour, for an average annualcost of $497
for each small broker-dealer to update an account disclosure document. The projected aggregate
annual cost for small broker-dealers is therefore estimated to be $375,732 per year, or (756 x
$497).
In summary, the total cost burden associated with Rule 17a-3 is approximately $54,448,137
per year, broken down as indicated below. 77
Summary of Cost Burdens
Name of Information
Collection

Type of Burden

Number of Respondents

Annual Cost Burden per
Respondent

Annual Cost for all
Respondents

Rule 17a-3 - providing updated
information to customers

Recordkeeping
& Third Party
Disclosure

3,764

$4,336.27

$ 16,321,719

Ongoing cost for equipment &
systems development

Recordkeeping

45

$832,148.57

$ 37,446,686

Rule 17a-3(a)(23) Part 1

Recordkeeping

456

$666.667

$304,000

*Rule 17a-3(a)(35): Record of
Identity of Associate Person
Responsible for Account/ Firm
Burden
-Small Broker-dealers

Recordkeeping

756

$497

$375,732

TOTAL

$ 54,448,137

*This burden was approved by OMB on October 3, 2019.

14.

Costs to Federal Government

There will be no additional costs to the Federal Government.
77

This includes annual postage costs of $16,321,719 and ongoing equipment and systems development costsof
$37,446,686 per year.

15.

Changes in Burden

As noted above, the changes in burdens for Rule 17a-3 result from the Commission adopting
amendments to Rule 17a-3 related to requirements to maintain records related to security-based swap
activity. Certain of the estimated burdens associated with these amendments have changed from the
burdens that were proposed. The changes in the estimated burdens between the proposing stage and
the adopting stage are summarized in the table below:

Changes in Hourly Burden
Name of Information
Collection

Annual
Industry
Burden
adopted
2,744

Annual Industry
Burden Originally
Proposed

Change in
Burden

Reason for Change in Burden

2,184

560

Broker-dealer SBSDs
only: Paragraph (a)(29)

507

1,520

(1,013)

The estimated burden associated with the
“Security-Based Swap Activities” burden category
was revised up as a result of reallocating certain
burdens (paragraphs (a)(26) and (a)(27))
previously associated with another category of
estimated burdens (“Broker-Dealer SBSDs and
Broker-Dealer MSBSPs”) to the “Security-Based
Swap Activities” Category.
The estimated burden associated with the “Brokerdealer SBSDs only” burden category was revised
down as a result of reallocating certain burdens
(paragraphs (a)(26) and (a)(27)) previously
associated with another category of estimated
burdens (“Broker-Dealer SBSDs and BrokerDealer MSBSPs”) to the “Security-Based Swap
Activities” Category.

ANC Broker-Dealers

0

317

(317)

Security-based swap
activities: Paragraphs
(a)(1), (a)(3), (a)(5),
(a)(6), (a)(7), (a)(8),
(a)(9), (a)(26), and
(a)(27)

The Commission proposed to require ANC
broker-dealers to make and keep current records
related to a proposed monthly stress test. The
proposed monthly stress test requirement was not
adopted by the Commission, and as a result, the
requirement to keep records related to the monthly
stress test was also not adopted.

As noted above, the total estimated burden associated with Rule 17a-3 has changed as a result
of the amendments to Rule 17a-3 adopted by the Commission in September 2019.
When adding the 4,866 hours resulting from the amendments to Rule 17a-3 to the 5,317,241
hours currently approved results in a total industry hour burden of 5,322,107 hours. This change is
summarized in the table below:
Changes in Hourly Burden
Rule

Annual
Industry
Burden
Currently

Revised Annual
Industry Burden
Based on
Amendments

Change in
Burden

Reason for Change in Burden

Approved
17a-3

5,317,241

5,322,107

4,866

The estimated burden hours associated with Rule
17a-3 have increased as a result of amendments to
Rule 17a-3 regarding security-based swap
activities of broker-dealers.

There is no change in the estimated cost burdens associated with Rule 17a-3.
16.

Information Collection Planned for Statistical Purposes

Not applicable. The information collection is not used for statistical purposes.
17.

Approval to Omit OMB Expiration Date

The Commission is not seeking approval to omit the expiration date.
18.

Exceptions to Certification for Paperwork Reduction Act Submissions

This collection complies with the requirements in 5 CFR 1320.9.
B.COLLECTIONS OF INFORMATION EMPLOYING STATISTICAL METHODS
This collection does not involve statistical methods.