SEC Keeps Tabs on Broker-Dealers' Customer Asset Custody
Published Date: 4/30/2025
Notice
Summary
The SEC wants to keep collecting info from broker-dealers using Form Custody, which they file every quarter to show how they handle customer assets. About 3,470 broker-dealers spend around 12 hours each quarter on this, costing roughly $344 per hour. The SEC is asking for comments before extending this form’s approval, so nothing major is changing, but your feedback matters!
Analyzed Economic Effects
2 provisions identified: 0 benefits, 2 costs, 0 mixed.
Quarterly Form Custody Filing Rule
If you are a broker-dealer, you must file Form Custody with your designated examining authority within 17 business days after the end of each calendar quarter and within 17 business days after your fiscal year end if that date is not a calendar quarter end. The form asks whether you hold custody of customer and non-customer assets and how those assets are maintained.
Estimated Time and Cost Burden
The SEC estimates about 3,470 broker-dealers must file Form Custody quarterly, taking about 12 hours per quarter per firm (3,470 firms × 4 filings × 12 hours = 166,560 hours per year). At an estimated $344 per hour for a compliance manager, the SEC estimates total internal compliance costs of approximately $57,296,640 per year.
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