12 C.F.R. Subpart B—Content and Timing of Notice
Title 12 - Banks and Banking
If you effect a securities transaction for a customer, you must give or send the customer the registered broker-dealer confirmation described at §551.80, or the written notice described at §551.90. For certain types of transactions, you may elect to provide the alternate notices described in §551.100. (a) If you elect to satisfy §551.70 by providing the customer with a registered broker-dealer confirmation, you must provide the confirmation by having the registered broker-dealer send the confirmation directly to the customer or by sending a copy of the registered broker-dealer's confirmation to the customer within one business day after you receive it. (b) If you have received or will receive remuneration from any source, including the customer, in connection with the transaction, you must provide a statement of the source and amount of the remuneration in addition to the registered broker-dealer confirmation described in paragraph (a) of this section. If you elect to satisfy §551.70 by providing the customer a written notice, you must give or send the written notice at or before the completion of the securities transaction. You must include all of the following information in a written notice: (a) Your name and the customer's name. (b) The capacity in which you acted (for example, as agent). (c) The date and time of execution of the securities transaction (or a statement that you will furnish this information within a reasonable time after the customer's written request), and the identity, price, and number of shares or units (or principal amount in the case of debt securities) of the security the customer purchased or sold. (d) The name of the person from whom you purchased or to whom you sold the security, or a statement that you will furnish this information within a reasonable time after the customer's written request. (e) The amount of any remuneration that you have received or will receive from the customer in connection with the transaction unless the remuneration paid by the customer is determined under a written agreement, other than on a transaction basis. (f) The source and amount of any other remuneration you have received or will receive in connection with the transaction. If, in the case of a purchase, you were not participating in a distribution, or in the case of a sale, were not participating in a tender offer, the written notice may state whether you have or will receive any other remuneration and state that you will furnish the source and amount of the other remuneration within a reasonable time after the customer's written request. (g) That you are not a member of the Securities Investor Protection Corporation, if that is the case. This does not apply to a transaction in shares of a registered open-end investment company or unit investment trust if the customer sends funds or securities directly to, or receives funds or securities directly from, the registered open-end investment company or unit investment trust, its transfer agent, its custodian, or a designated broker or dealer who sends the customer either a confirmation or the written notice in this section. (h) Additional disclosures. You must provide all of the additional disclosures described in the following chart for transactions involving certain debt securities: You may elect to satisfy §551.70 by providing the alternate notices described in the following chart for certain types of transactions. You may provide any written notice required under this subpart B electronically. If a customer has a facsimile machine, you may send the notice by facsimile transmission. You may use other electronic communications if: (a) The parties agree to use electronic instead of hard copy notices; (b) The parties are able to print or download the notice; (c) Your electronic communications system cannot automatically delete the electronic notice; and (d) Both parties are able to receive electronic messages. You may not charge a fee for providing a notice required under this subpart B, except that you may charge a reasonable fee for the notices provided under §§551.100(a), (d), and (e).
Title 12: Banks and Banking
PART 551—RECORDKEEPING AND CONFIRMATION REQUIREMENTS FOR SECURITIES TRANSACTIONS
Subpart B—Content and Timing of Notice
§ 551.70 What type of notice must I provide when I effect a securities transaction for a customer?
§ 551.80 How do I provide a registered broker-dealer confirmation?
§ 551.90 How do I provide a written notice?
------------------------------------------------------------------------ You must provide the following If you effect a transaction additional information in your written involving . . . notice . . .------------------------------------------------------------------------(1) A debt security subject to A statement that the issuer may redeem redemption before maturity. the debt security in whole or in part before maturity, that the redemption could affect the represented yield, and that additional redemption information is available upon request.(2) A debt security that you (i) The dollar price at which you effected exclusively on the effected the transaction; and basis of a dollar price. (ii) The yield to maturity calculated from the dollar price. You do not have to disclose the yield to maturity if: (A) The issuer may extend the maturity date of the security with a variable interest rate; or (B) The security is an asset-backed security that represents an interest in, or is secured by, a pool of receivables or other financial assets that are subject continuously to prepayment.(3) A debt security that you (i) The yield at which the effected on basis of yield. transaction, including the percentage amount and its characterization (e.g., current yield, yield to maturity, or yield to call). If you effected the transaction at yield to call, you must indicate the type of call, the call date, and the call price; (ii) The dollar price calculated from that yield; and (iii) The yield to maturity and the represented yield, if you effected the transaction on a basis other than yield to maturity and the yield to maturity is lower than the represented yield. You are not required to disclose this information if: (A) The issuer may extend the maturity date of the security with a variable interest rate; or (B) The security is an asset-backed security that represents an interest in, or is secured by, a pool of receivables or other financial assets that are subject continuously to prepayment.(4) A debt security that is an (i) A statement that the actual yield asset-backed security that of the asset-backed security may vary represents an interest in, or according to the rate at which the is secured by, a pool of underlying receivables or other receivables or other financial financial assets are prepaid; and assets that are subject (ii) A statement that you will furnish continuously to prepayment. information concerning the factors that affect yield (including at a minimum estimated yield, weighted average life, and the prepayment assumptions underlying yield) upon the customer's written request.(5) A debt security, other than A statement that the security is a government security. unrated by a nationally recognized statistical rating organization, if that is the case.------------------------------------------------------------------------
§ 551.100 What are the alternate notice requirements?
------------------------------------------------------------------------ If you effect a securities transaction . . . Then you may elect to . . .------------------------------------------------------------------------(a) For or with the account of a Give or send to the customer customer under a periodic plan, sweep within five business days account, or investment company plan. after the end of each quarterly period a written statement disclosing: (1) Each purchase and redemption that you effected for or with, and each dividend or distribution that you credited to or reinvested for, the customer's account during the period; (2) The date of each transaction; (3) The identity, number, and price of any securities that the customer purchased or redeemed in each transaction; (4) The total number of shares of the securities in the customer's account; (5) Any remuneration that you received or will receive in connection with the transaction; and (6) That you will give or send the registered broker- dealer confirmation described in § 551.80 or the written notice described in § 551.90 within a reasonable time after the customer's written request.(b) For or with the account of a Give or send to the customer customer in shares of an open-ended the written statement management company registered under described at paragraph (a) of the Investment Company Act of 1940 this section on a monthly that holds itself out as a money basis. You may not use the market fund and attempts to maintain a alternate notice, however, if stable net asset value per share. you deduct sales loads upon the purchase or redemption of shares in the money market fund.(c) For an account for which you do not Give or send to the customer a exercise investment discretion, and written notice at the agreed- for which you and the customer have upon time and with the agreed- agreed in writing to an arrangement upon content, and include a concerning the time and content of the statement that you will written notice. furnish the registered broker- dealer confirmation described in § 551.80 or the written notice described in § 551.90 within a reasonable time after the customer's written request.(d) For an account for which you Give or send the registered exercise investment discretion other broker-dealer confirmation than in an agency capacity, excluding described in § 551.80 or common or collective investment funds. the written notice described in § 551.90 within a reasonable time after a written request by the person with the power to terminate the account or, if there is no such person, any person holding a vested beneficial interest in the account.(e) For an account in which you Give or send each customer a exercise investment discretion in an written itemized statement agency capacity. specifying the funds and securities in your custody or possession and all debits, credits, and transactions in the customer's account. You must provide this information to the customer not less than once every three months. You must give or send the registered broker-dealer confirmation described in § 551.80 or the written notice described in § 551.90 within a reasonable time after a customer's written request.(f) For a common or collective (1) Give or send to a customer investment fund. who invests in the fund a copy of the annual financial report of the fund, or (2) Notify the customer that a copy of the report is available and that you will furnish the report within a reasonable time after a written request by a person to whom a regular periodic accounting would ordinarily be rendered with respect to each participating account.------------------------------------------------------------------------
§ 551.110 May I provide a notice electronically?
§ 551.120 May I charge a fee for a notice?
