SEC Customer Protection Rule 15c3-3
May 17, 2012
Registration Fee: US$895.00 Register Location Instructor
Many classes sell out; we suggest registering at least one week in advance to ensure your seat.
Beginner/Intermediate Level, 7 CPE Credits
Instructor: Mark E. Axelrod, CPA
Hours: 9:00 am - 4:30 pm; Registration/Breakfast begins at 8:30 am
Location: New York City, Bayard's, One Hanover Square
This intensive course will review the details of the Customer Protection Rule 15c3-3 of the SEC. It will go into detail as to how contents of a customer’s account, portfolio positions and money balances, are required to be protected by the securities industry. It will also detail how various calculations are preformed on a daily, weekly and monthly basis to ensure this protection. It will define specifics of what protection means and how it is achieved in the broker/dealer community.
The seminar includes various exercises to ensure the student has a thorough, real-world understanding of the material covered. The course does not require more than basic math skills.
Course Outline
- Definition of “customer” as it pertains to rule 15c3-3
- What does the rule mean by “possession or control?”
- What components of a customer’s account need to be afforded protection and what components do not.
- How do we accomplish protection of customer securities as well as customer funds?
- What if protection of customer assets is not achieved?
- Examples of how to calculate protection requirements for both portfolio securities and money balances.
- Review of Reserve Fund Calculation
- What is a “qualified security?"
Definitions
- Customer
- Fully – Paid Security
- Margin Security
- Excess Margin Security
- Qualified Security
- Free Credit Balance
Physical Possession or Control
- What is P&C?
- What needs to be in a Broker/Dealers P&C?
- When does P&C need to be obtained?
- Exceptions to P&C
Control of Securities
- Clearing Corporation
- Custody of a bank under specific circumstances
- Special Omnibus Account
- Items in transfer
- Foreign Depository
- Other Bank Depositories
- Items in transit
- Other approved locations
Requirements of P&C
- Determination made each business day
- Monthly for inactive margin accounts
- Time frames for
- Stock Loan
- Fail to Receive
- Bona Short Position
- Transfer
- Written Procedures
Special Reserve Bank Account
-
Computation date
-
Deposit and Withdrawal Time Frames
-
Allowable deposits
-
Notification of Banks
-
Hindsight Deficiencies
-
Exceptions
Formula Computation
-
Purpose of Computation
-
Includable - Excludable items
-
Stock record allocation
-
Components of formula
-
PAIB
Proposed Rule Change
-
PAB accounts
-
Cash Balance Limitations
-
Permitted Deposits
-
Definition of Qualified Securities
-
Reduction of Aggregate Debit Items
-
Seg deficits allocating to proprietary and non-customer locations