The Municipal Securities Rulemaking Board has issued a request for comment on Rule A-12 and Form A-12 on registration, seeking input from the market on draft amendments that would gather more information on the associated persons of bank dealers.
The board is hoping to gather this information from bank dealers and eventually display such information publicly on its site. In its request for comment, the board asks stakeholders to comment on whether displaying such information would meet the intended goal of increased transparency.
"Presently, the MSRB has limited access to information about associated persons of bank dealers as Forms MSD-4 and MSD-5 are filed solely with banking regulators," the MSRB said in its release. "The MSRB believes that gathering this information about associated persons of bank dealers would fill in an information gap for the MSRB about these bank dealer representatives and aid the MSRB in understanding the evolving scope of bank dealer activities for rulemaking purposes," the MSRB said.
The board
The request also details what the proposal may cost each bank dealer in compliance costs, estimating up-front costs to be $3,820 made up of costs for revision of policies and procedures, outside counsel review and training. They also estimate annual ongoing costs to be $2,600 on the high end and $1,040 on the lower end.
The eleven questions the board has stakeholders answer includes a question about whether the estimated costs are reasonable, along with whether the amendments place undue burdens on small or large firms, what benefits having such information public would have and whether the draft amendments provide protections for municipal entities and other market participants.
The board noted it has heard from other regulators that having such information in an accessible location would aid in their examination activities.
"The MSRB has also heard from bank dealers that the dearth of public information about registration and qualification status of bank dealers' associated persons may make certain bank dealers less competitive, due to the inability to quickly and easily prove the registration and qualification status of their associated persons to potential clients, " the MSRB said.
Comments are due no later than August 5th.
