SEC Issues Guidance to Establish Recordkeeping and Reporting Requirements Under Title VII of the Dodd-Frank Act

The SEC has issued a final rule, Recordkeeping and Reporting Requirements for Security-Based Swap Dealers, Major Security-Based Swap Participants, and Broker-Dealers, which includes new rules and rule amendments mandated by Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The final rule requires security-based swap dealers, major security-based swap participants, and broker-dealers to “create and retain fundamental business records to document and track their operations, facilitating the Commission's ability to monitor compliance and reducing risk to the market.” Seven key topics are addressed:

• Record-making requirements.
• Record preservation requirements.
• Periodic reporting and annual audit requirements.
• Early warning notification.
• Security counts.
• Alternative compliance mechanisms.
• Cross-border application.

The final rule will become effective 60 days after the date of its publication in the Federal Register. For more information, see the press release on the SEC’s Web site.