01-3624. Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Filings and Information Services, Washington, DC 20549.

Extension: Rule 17a-4; SEC File No. 270-198; OMB Control No. 3235-0279.

Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (“Commission”) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval.

Rule 17a-4 (17 CFR 240.17a-4) requires exchange members, brokers and dealers to preserve for prescribed periods of time certain records required to be made by Rule 17a-3. In addition, Rule 17a-4 requires the preservation of records required to be made by other Commission rules and other kinds of records which firms make or receive in the ordinary course of business. These include, but are not limited to, bank statements, cancelled checks, bills receivable and payable, originals of communications, and descriptions of various transactions. Rule 17a-4 also permits broker-dealers to employ, under certain conditions, electronic storage media to maintain records required to be maintained under Rules 17a-3 and 17a-4.

These are approximately 7,525 active, registered broker-dealers. The staff estimates that the average amount of time necessary to preserve the books and records as required by Rule 17a-4 is 1.001 hours per broker-dealer per working day. Thus the staff estimates that because there are approximately 250 business day per year, the total compliance burden for 7,525 respondents is 1,883,131 hours.

The staff believes that compliance personnel would be charged with ensuring compliance with Commission regulation, including Rule 17a-4. The staff estimates that the hourly salary of a compliance manager is $82.50 per hour.^[1] Based upon these numbers, the total cost of compliance for 7,525 respondents is $155,358,308 per year.^[2] Despite the total burden hour decrease of 244,054 (resulting from the decrease in the number of respondents from 8,500 to 7,525), the increase in the estimated hourly salary used (from $48.08 as used in previous estimates to the $82.50 obtained from the Securities Industry Association's survey of industry salaries, which was not previously available) caused the total cost of compliance to be $53,086,138 higher than the previous estimate of $102,272.170.

Written comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of the information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication.

Direct your written comments to Michael E. Bartell, Associate Executive Director, Office of Information Technology, Securities and Exchange Commission, 450 5th Street, NW., Washington, DC 20549.

Dated: February 6, 2001.

Margaret H. McFarland,

Deputy Secretary.

Footnotes

1.  Securities Industry Association, Management and Professional Earnings, Table 051 (Compliance Manager) + 35% overhead (based on end-of-year 1998 figures).

2.  (1.001 hours per day × 250 days × 7,525 active, registered broker-dealer respondents) = 1,883,131 total hours per year. (1,883,131 hours × $82.50 per hour) = $155,358,308 per year.