SEC proposes large trader reporting system

Purpose - The purpose of this paper is to describe the Securities and Exchange Commission's recently proposed new rules to establish a large trading reporting system.Design methodology approach - The paper provides an overview of the new Rule 13h-1, which, if adopted, would require large trader...

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Bibliographic Details
Published in:The journal of investment compliance 2010-09, Vol.11 (3), p.8-13
Main Authors: Sacks, Russell D, Blankenship, Michael J
Format: Article
Language:English
Subjects:
Compliance
Equity
Fair market value
Financial disclosure
Independent regulatory commissions
Proposals
Regulatory agencies
Regulatory compliance
Reporting requirements
SEC regulations
Securities
Securities industry
Securities law
Securities trading
Stock exchanges
Studies
Trade
United States of America
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Summary:Purpose - The purpose of this paper is to describe the Securities and Exchange Commission's recently proposed new rules to establish a large trading reporting system.Design methodology approach - The paper provides an overview of the new Rule 13h-1, which, if adopted, would require large traders to identify themselves to the SEC and to be issued a "Large Trader Identification Number". It outlines the proposed definition of a large trader and describes how a large trader would report itself to the SEC and the broker-dealers it uses to effect trades using a new Form 13H. The paper also provides detailed guidance to broker-dealers regarding their books and records obligations under the proposed rule.Findings - The proposed new rule and form are intended to provide the SEC with data to facilitate its ability to assess the impact of the trading activity, to reconstruct trading activity following periods of unusual market volatility, and to analyze significant market events for regulatory purposes. Registered broker-dealers would also be under an obligation to maintain records of transactions effected in accounts identified to it as large trader accounts; electronically report large trader transaction information to the SEC upon request; and monitor compliance with the new rule.Originality value - The paper provides practical guidance from experienced securities lawyers regarding an important proposed change.
ISSN:1528-5812
1758-7476
DOI:10.1108/15285811011082188