[Federal Register Volume 77, Number 175 (Monday, September 10, 2012)]
[Notices]
[Pages 55512-55513]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-22144]
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SECURITIES AND EXCHANGE COMMISSION
Submission for OMB Review; Comment Request
Upon Written Request Copies Available From: Securities and Exchange
Commission, Office of Investor Education and Advocacy, Washington, DC
20549-0213.
Extension:
Regulation S-P, SEC File No. 270-480, OMB Control No. 3235-0537.
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.) the Securities and Exchange Commission
(``Commission'') has submitted to the Office of Management and Budget a
request for approval of extension of the previously approved collection
of information provided for in the privacy notice and opt out notice
provisions of Regulation S-P--Privacy of Consumer Financial Information
(17 CFR part 248) under the Securities Exchange Act of 1934 (15 U.S.C.
78a et seq.) (``Exchange Act''). The Commission plans to submit this
existing collection of information to the Office of Management and
Budget for extension and approval.
The privacy notice and opt out notice provisions of Regulation S-P
(the ``Rule'') implement the privacy notice and opt out notice
requirements of Title V of the Gramm-Leach-Bliley Act (``GLBA''), which
include the requirement that at the time of establishing a customer
relationship with a consumer and not less than annually during the
continuation of such relationship, a financial institution
[[Page 55513]]
shall provide a clear and conspicuous disclosure to such consumer of
such financial institution's policies and practices with respect to
disclosing nonpublic personal information to affiliates and
nonaffiliated third parties (``privacy notice''). Title V of the GLBA
also provides that, unless an exception applies, a financial
institution may not disclose nonpublic personal information of a
consumer to a nonaffiliated third party unless the financial
institution clearly and conspicuously discloses to the consumer that
such information may be disclosed to such third party; the consumer is
given the opportunity, before the time that such information is
initially disclosed, to direct that such information not be disclosed
to such third party; and the consumer is given an explanation of how
the consumer can exercise that nondisclosure option (``opt out
notice''). The Rule applies to broker-dealers, investment advisers
registered with the Commission, and investment companies (``covered
entities'').
Commission staff estimates that, as of early May, 2012, the Rule's
information collection burden applies to approximately 21,500 covered
entities (approximately 4,700 broker-dealers, 12,600 investment
advisers registered with the Commission, and 4,200 investment
companies). In view of (a) the minimal recordkeeping burden imposed by
the Rule (since the Rule has no recordkeeping requirement and records
relating to customer communications already must be made and retained
pursuant to other SEC rules); (b) the summary fashion in which
information must be provided to customers in the privacy and opt out
notices required by the Rule (the model privacy form adopted by the SEC
and the other agencies in 2009, designed to serve as both a privacy
notice and an opt out notice, is only two pages); (c) the availability
to covered entities of the model privacy form and online model privacy
form builder; and (d) the experience of covered entities' staff with
the notices, SEC staff estimates that covered entities will each spend
an average of approximately 12 hours per year complying with the Rule,
for a total of approximately 258,000 annual burden-hours (12 x 21,500 =
258,000). SEC staff understands that the vast majority of covered
entities deliver their privacy and opt out notices with other
communications such as account opening documents and account
statements. Because the other communications are already delivered to
consumers, adding a brief privacy and opt out notice should not result
in added costs for processing or for postage and materials. Also,
privacy and opt out notices may be delivered electronically to
consumers who have agreed to electronic communications, which further
reduces the costs of delivery. Because SEC staff assumes that most
paper copies of privacy and opt out notices are combined with other
required mailings, the burden-hour estimates above are based on
resources required to integrate the privacy and opt out notices into
another mailing, rather than on the resources required to create and
send a separate mailing. SEC staff estimates that, of the estimated 12
annual burden-hours incurred, approximately 8 hours would be spent by
administrative assistants at an hourly rate of $65, and approximately 4
hours would be spent by internal counsel at an hourly rate of $378, for
a total annualized cost of $2,032 for each of the covered entities (8 x
$65 = $520; 4 x $378 = $1,512; $520 + $1,512 = $2,032). Hourly cost
estimates for personnel time are derived from the Securities Industry
and Financial Markets Association's Management & Professional Earnings
in the Securities Industry 2011, modified by SEC staff to account for
an 1800-hour work-year and multiplied by 5.35 to account for bonuses,
firm size, employee benefits, and overhead. Accordingly, SEC staff
estimates that the total annualized cost for the estimated total hour
burden for the approximately 21,500 covered entities subject to the
Rule is approximately $43,688,000 ($2,032 x 21,500 = $43,688,000).
Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information
shall have practical utility; (b) the accuracy of the Commission's
estimates of the burden of the proposed collection of information on
respondents; (c) ways to enhance the quality, utility, and clarity of
the information to be collected; and (d) ways to minimize the burden of
the collection of information on respondents, including through the use
of automated collection techniques or other forms of information
technology. Consideration will be given to comments and suggestions
submitted in writing within 60 days of this publication.
The Commission may not conduct or sponsor a collection of
information unless it displays a currently valid control number. No
person shall be subject to any penalty for failing to comply with a
collection of information subject to the PRA that does not display a
valid Office of Management and Budget (OMB) control number.
Background documentation for this information collection may be
viewed at the following Web site: www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the Securities and Exchange
Commission, Office of Information and Regulatory Affairs, Office of
Management and Budget, Room 10102, New Executive Office Building,
Washington, DC 20503, or by sending an email to: [email protected]; and (ii) Thomas Bayer, Director/Chief Information
Officer, Securities and Exchange Commission, c/o Remi Pavlik-Simon,
6432 General Green Way, Alexandria, VA 22312, or by sending an email
to: [email protected]. Comments must be submitted to OMB within 30
days of this notice.
Dated: September 4, 2012.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-22144 Filed 9-7-12; 8:45 am]
BILLING CODE 8011-01-P