SEC Yawns Through Broker Securities Count Rule Extension
Published Date: 8/13/2025
Notice
Summary
The SEC wants to keep Rule 17a-13 going, which makes brokers check their securities every few months to catch any mix-ups. This rule mostly affects brokers who handle lots of securities, but some smaller or special ones are exempt. There’s no new cost or big changes, just a request to keep the rule’s paperwork collection going smoothly.
Analyzed Economic Effects
5 provisions identified: 2 benefits, 3 costs, 0 mixed.
Estimated recordkeeping time burden
As of December 2024 there were about 3,342 active broker-dealers; the staff estimates an average of 100 hours per respondent per year to maintain Rule 17a-13 records, for a total estimated recordkeeping burden of approximately 334,200 hours per year (3,342 respondents × 100 hours/respondent).
Quarterly securities count requirement
Registered broker-dealers must physically examine and count all securities at least once each calendar quarter and account for securities under their control or direction. The rule also allows the full list of securities to be counted on a cyclical basis under specified conditions instead of on a single date.
Specified exemptions from Rule 17a-13
Rule 17a-13 exempts broker-dealers that limit their business to selling and redeeming registered investment company securities and interests in insurance company separate accounts, and those who solicit accounts for federally insured savings and loan associations provided they promptly transmit all funds and hold no customer funds or securities. It also does not apply to certain broker-dealers registered only because they effect transactions in securities futures products.
Record unresolved discrepancies and possible reporting
Differences between a broker-dealer's securities count and its records that remain unresolved seven business days after the examination must be recorded in the firm's records. Such recorded discrepancies may need to be reported (for example, as a loss on Form X-17a-5 under Exchange Act Rule 17a-5) and may be examined by the Commission or the firm's designated self-regulatory organization.
Confidentiality of Rule 17a-13 records
Records made under Rule 17a-13 are available only to Commission examination staff, state securities authorities, and applicable self-regulatory organizations, and the Commission generally does not publish or make available information arising from examinations, subject to the Freedom of Information Act and Commission rules.
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