[Federal Register Volume 61, Number 143 (Wednesday, July 24, 1996)]
[Notices]
[Pages 38493-38494]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18799]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37451; File No. SR-MSTC-96-03]
Self-Regulatory Organizations; Midwest Securities Trust Company;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to Return of Participants Fund Contributions
July 17, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on June 18, 1996, the Midwest
Securities Trust Company (``MSTC'') filed with the Securities and
Exchange Commission (``Commission'') the proposed rule change, as
described in Items I, II, and III below, which Items have been prepared
primarily by MSTC. On July 2, 1996, MSTC amended the proposed rule
change to make a technical correction.\2\ The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
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\1\ 15 U.S.C. Sec. 78s(b)(1) (1988).
\2\ Letter from David T. Rusoff, Foley & Lardner, to Peter
Geraghty, Division of Market Regulation, Commission (July 2, 1996).
I. Self-Regulatory Organization's Statement of the Terms of Substance
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of the Proposed Rule Change
MSTC proposed to notify those participants whose accounts are
closed and who have provided properly executed indemnification
agreements of a deferral of the final distribution of their
participants fund deposits for sixty days, until August 15, 1996. A
notice will be sent to all participants.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, MSTC included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. MSTC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of such
statements.\3\
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\3\ The Commission has modified the text of the summaries
prepared by MSTC.
(A) Self-Regulatory Organization's Statement of the Purpose of, and
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Statutory Basis for, the Proposed Rule Change
On January 5, 1996, the Commission approved a proposed rule change
filed by MSTC, which called for termination of MSTC services as of
January 15, 1996.\4\ On February 20, 1996, MSTC filed with the
Commission a proposed rule change, which was effective upon filing,
relating to, among other things, the procedures to be used by MSTC with
respect to the liquidation of the MSTC participants fund.\5\ An
attachment to the proposed rule change set forth a schedule for the
return of participant fund deposits. However, such attachment expressly
provided that the schedule was subject to the right of MSTC to retain
funds if necessary in its view to fund possible contingent liabilities.
Because MSTC has not yet completed a wind-down of its operations,
contingent liabilities may still exist. Therefore, pending completion
of the wind-down, MSTC intends to postpone the final distribution of
participant fund contributions for sixty days, until August 15, 1996.
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\4\ For a complete description of MSTC's withdrawal from the
securities depository business, refer to Securities Exchange Act
Release No. 36684 (January 9, 1996), 61 FR 1195 [File No. SR-MSTC-
95-10] (order approving proposed rule change).
\5\ Securities Exchange Act Release No. 36965 (March 13, 1996),
61 FR 11456 [File No. SR-MSTC-96-02] (notice of filing and immediate
effectiveness of proposed rule change).
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MSTC believes the proposed rule change is consistent with Section
17A(b)(3)(F) \6\ of the Act because it will facilitate the prompt and
accurate clearance and settlement of securities transactions and will
assure the safeguarding of securities and funds which are in MSTC's
custody or control or for which MSTC is responsible.
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\6\ 15 U.S.C. Sec. 78q-1(b)(3)(F) (1988).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
MSTC does not believe that the proposed rule change will impose any
burden on competition.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants or Others
MSTC has neither solicited nor received written comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(i) \7\ of the Act and Rule 19b-4(e)(1) \8\ promulgated
thereunder because the proposal constitutes a stated policy, practice,
or interpretation with respect to the meaning, administration, or
enforcement of an existing rule of MSTC. At any time within sixty days
of the filing of such rule change, the Commission may summarily
abrogate such rule change if it appears to the Commission that such
action is necessary or appropriate in the public interest, for the
protection of investors, or otherwise in furtherance of the purposes of
the Act.
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\7\ 15 U.S.C. Sec. 78s(b)(3)(A)(i) (1988).
\8\ 17 CFR 240.19b-4(e)(1) (1995).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.
Copies of the submissions, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the
[[Page 38494]]
proposed rule change between the Commission and any person, other than
those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. Sec. 552, will be available for inspection and
copying at the Commission's Public Reference Section, 450 Fifth Street,
NW., Washington, DC 20549. Copies of such filing will also be available
for inspection and copying at the principal office of MSTC. All
submissions should refer to File No. SR-MSTC-96-03 and should be
submitted by August 14, 1996.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12) (1995).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-18799 Filed 7-23-96; 8:45 am]
BILLING CODE 8010-01-M
