[Federal Register Volume 77, Number 195 (Tuesday, October 9, 2012)]
[Notices]
[Pages 61458-61460]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-24742]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67967; File No. SR-BX-2012-062]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Offer
Members the Ability To Pay a Regulatory Fine Pursuant to an Installment
Plan
October 2, 2012.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on September 24, 2012, NASDAQ OMX BX, Inc. (``BX'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
The Exchange proposes a rule change to offer members the ability to
pay a regulatory fine pursuant to an installment plan, under certain
conditions. The text of the proposed rule change is available at http://nasdaqomxbx.cchwallstreet.com, at the Exchange's principal office, and
at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
BX is proposing to amend Rule 8320 governing ``Payment of Fines,
Other Monetary Sanctions, or Costs; Summary Action for Failure to Pay''
to offer members the ability to pay a regulatory fine pursuant to an
installment plan, under certain conditions. In order for a member to be
eligible to pay a regulatory fine via an installment plan, the fine
under the applicable letter of acceptance, waiver, and consent
(``AWC'') \3\ must be $50,000 or more. A fine of less than $50,000 is
not eligible for the installment plan. When submitting its AWC, the
member must check the installment plan option on the election of
payment form included with the AWC. A sample election of payment form
and AWC are included in Exhibit 3 \4\ to this proposed rule change. A
down payment of twenty-five percent
[[Page 61459]]
(25%) or more of the total fine must be submitted with the signed AWC.
---------------------------------------------------------------------------
\3\ See BX Rule 9216(a).
\4\ The Commission notes that Exhibit 3 is an exhibit to the
proposed rule change, not to this Notice.
---------------------------------------------------------------------------
After receipt of the AWC and down payment, an installment package,
including a promissory note and payment schedule, will be mailed to the
member. A sample promissory note and payment schedule are included in
Exhibit 3 to this proposed rule change. The member must then submit an
executed (signed and notarized) promissory note for the unpaid balance
of the fine, along with its first installment payment. The term of the
installment plan may not exceed four years after the execution of the
AWC. The member may elect monthly or quarterly payments.
2. Statutory Basis
BX believes that the proposed rule change is consistent with the
provisions of Section 6 of the Act,\5\ in general, and with Section
6(b)(5) of the Act,\6\ in particular, in that the proposal is designed
to prevent fraudulent and manipulative acts and practices, to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest. In addition, BX believes
that the proposed rule change is consistent with the provisions of
Section 6(b)(6) and 6(b)(7) of the Act,\7\ which require an exchange to
provide fair procedures for the disciplining of members and persons
associated with members. Specifically, BX believes that the proposal
will promote the settlement of disciplinary cases by allowing members
to make installment payments. BX believes that settlement is a
beneficial method of disciplining members because it imposes meaningful
sanctions on the member while avoiding the cost and uncertainty of a
protracted disciplinary proceeding. BX further believes that affording
members with the opportunity to pay a regulatory fine over a period of
time may allow BX to impose higher fines in appropriate circumstances
and diminish the risk that sanctioned members will fail to pay.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f.
\6\ 15 U.S.C. 78f(b)(5).
\7\ 15 U.S.C. 78f(b)(6) and (b)(7).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\9\
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of the filing of the
proposed rule change, or such shorter time as designated by the
Commission. The Exchange has satisfied this requirement.
---------------------------------------------------------------------------
A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\11\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that BX may offer
members that are contemplating the execution of an AWC the option of
entering into an installment arrangement as soon as possible. The
Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest as
it will provide members the option of paying large fines in
installments. Therefore, the Commission hereby waives the 30-day
operative delay and designates the proposed rule change to be operative
upon filing with the Commission.\12\
---------------------------------------------------------------------------
\10\ 17 CFR 240.19b-4(f)(6).
\11\ 17 CFR 240.19b-4(f)(6)(iii).
\12\ For the purposes of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-BX-2012-062 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-BX-2012-062. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room on official business
days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for inspection and copying at the
principal offices of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from
[[Page 61460]]
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-BX-
2012-062, and should be submitted on or before October 30, 2012.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
---------------------------------------------------------------------------
\13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-24742 Filed 10-5-12; 8:45 am]
BILLING CODE 8011-01-P