Highlights Recently Published Regulatory Notices 16-30 of November 2016


Highlights Recently Published Regulatory Notices

16 – 30 of November 2016

From the Chicago Board Options Exchange

  • Proposes several changes to its Disaster Recovery rule to further strengthen its response to such an event.
  • Files amendment to its rule regarding responsibilities for ensuring compliance with open outcry priority and allocation requirements as well as Trade-Through prohibitions.
  • Proposes to extend the Penny Pilot Program through June 30, 2017.

From the Depository Trust Company

  • Updates participants on its plans to begin announcing certain 305(c) deemed distributions on December 2, 2016 with 871(m) announcements beginning in 2017.
  • Announces that on December 2, 2016 it will display Price Basis, DTC Multiply/Divide Indicator, Fractional Security Rule and Rounding Factor fields on its PTS/PBS Rights Subscriptions Right Offering Information screen.

From Fixed Income Clearing Corporation

  • Advises participants that the SEC has rejected its rule filing to amend the MBSD clearing fund methodology and in response has filed an amended rule filing.
  • Announces it will perform a pre-implementation impact analysis related to the GSD Capped Contingent Liquidity Facility program during the period December 1, 2016 through January 31, 2017.


  • Proposes to add new Supplementary Material to its Rule 5210 addressing two specific types of disruptive quoting and trading activity as well as amending its Rule 09—to permit expedited proceeding for prompt actions addressing violations.
  • Fines Oppenheimer $1.575 million and orders restitutions to customers in the amount of $1.85 million for failures in providing information to FINRA and customers during arbitration.
  • Fines VALIC $1.75 million for failure to identify and address conflicts of interest in the firm’s compensation policy and certain failure to supervise violations.
  • Fines Merrill Lynch $6.25 million and require customer restitution for inadequate supervision of its Loan Management accounts and their client’s use of the leverage in their brokerage accounts.

From Municipal Securities Rulemaking Board

  • Issues interpretive guidance related to the required time of trade disclosures required under its Rule G-47 includes a requirement to disclose that when a municipal securities bears a “market discount.”
  • Announces the effective date of May 14, 2018 for the new pricing disclosure requirements for customer confirmations.

From Nasdaq

  • Proposes to extend the Penny Pilot program through June 30, 2017 or the date of permanent approval, if earlier.
  • Files rule change to establish a new “Extended Life Priority Order” attribute to allow displayed orders committed to one-second or longer resting period to receive higher priority that other displayed orders of the same price on its order book.

From National Securities Clearing Corporation

  • Announces the details of its testing plans and program for the Consolidated Trade Summary Re-Write initiative starting on December 12, 2016.
  • Updates participants on its plans related to the move to T+2 settlement as it pertains to its systemically updating the Fund/SERV system for specific securities to the T+2 settlement cycle effective September 5, 2017.

From Securities & Exchange Commission

  • Announces a settlement with JPMorgan Chase for charges that JPMorgan Chase won business from clients and corruption with government officials in the Asia-Pacific region in violation of the Foreign corrupt Practices Act.
  • Approves MSRB and FINRA rule proposals to require member to disclose pricing information on customer confirmations on certain retail municipal, corporate and agency fixed income transactions.