[Federal Register Volume 59, Number 249 (Thursday, December 29, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-32098]
[[Page Unknown]]
[Federal Register: December 29, 1994]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35138; File No. SR-NASD-94-59]
Self-Regulatory Organizations; Order Approving Proposed Rule
Change by National Association of Securities Dealers, Inc. Relating to
Publication of Final NASD Disciplinary Decisions
December 22, 1994.
On October 23, 1994, the National Association of Securities
Dealers, Inc. (``NASD'' or ``Association'') filed with the Securities
and Exchange Commission (``SEC'' or ``Commission'') a proposed rule
change pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934 (``Act''),\1\ and Rule 19b-4 thereunder.\2\ The proposed rule
change amends the NASD's Resolution of the Board of Governors--Notice
to Membership and Press of Suspensions, Expulsions, Revocations, and
Monetary Sanctions and Release of Certain Information Regarding
Disciplinary History of Members and Their Associated Persons under
Article V, Section 1 of the Association's Rules of Fair Practice
(``Resolution'').\3\
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\1\15 U.S.C. Sec. 78s(b)(1).
\2\17 CFR 240.19b-4.
\3\NASD Manual, Rules of Fair Practice, Art. V, Sec. 1 (CCH)
2301.
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Notice of the proposed rule change, together with the substance of
the proposal, was provided by issuance of a Commission release
(Securities Exchange Act Release No. 34954, November 9, 1994) and by
publication in the Federal Register (59 FR 59263, November 16, 1994).
No comment letters were received. This order approves the proposed rule
change.
The Resolution currently requires that a final decision of the
NASD's National Business Conduct Committee (``NBCC'') or the Board of
Governors of the NASD (``Board'') be promptly transmitted to the
membership and to the press concurrently, if it imposes monetary
sanctions of $10,000 or more or penalties of expulsion, revocation,
suspension and/or the barring of a person from being associated with
all members. However, the Resolution currently does not permit such a
notice to be sent prior to the expiration of 30 days from the date of a
decision. Upon review, the NASD determined that it should: (i)
eliminate the 30 day notification delay regarding NASD final decisions
ordering the most serious sanctions (i.e., expulsion, revocation, and/
or the baring of a person from being associated with all members); and
(ii) notify the membership and the press promptly upon issuance of a
final decision of expulsion, revocation, and/or the barring of a person
from being associated with all members.
The rule change approved herein eliminates the 30 day notification
delay regarding an NASD final decision ordering expulsion, revocation,
and/or the barring of a person from being associated with all members.
However, the rule change does not alter the 30 day notification delay
with respect to a decision imposing sanctions other than expulsion,
revocation, and/or the barring of a person from being associated with
all members, nor does it alter the Resolution's current procedures with
respect to decisions of the District Business Conduct Committees. The
Commission finds that the proposed rule change is consistent with the
requirements of the Act and the rules and regulations thereunder
applicable to the NASD and, in particular, the requirements of Section
15A(b)(6) of the Act.\4\ Section 15A(b)(6) requires, inter alia, that
the NASD's rules be designed to prevent fraudulent and manipulative
acts, promote just and equitable principles of trade, and protect
investors and the public interest. The Commission believes that
promptly notifying NASD members and the press of a final decision of
the NBCC or the Board ordering an expulsion, revocation, and/or the
barring of a person from being associated with all members will provide
important information to investors, thereby serving the interest of
investor protection.
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\4\15 U.S.C. Sec. 78o-3.
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It Is Therefore Ordered, pursuant to Section 19(b)(2) of the Act,
that File No. SR-NASD-94-59 be, and hereby is, approved.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority, 17 CFR 200.30-3(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-32098 Filed 12-28-94; 8:45 am]
BILLING CODE 8010-01-M
