Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Approving a Proposed Rule Change To Amend Exchange Rule 4.21 Relating to Third Party Deposits, 5874 [E9-2160]

Download as PDF 5874 Federal Register / Vol. 74, No. 20 / Monday, February 2, 2009 / Notices Securities and Exchange Commission, C/O Shirley Martinson, 6432 General Green Way, Alexandria, Virginia 22312; or send an e-mail to: PRA_Mailbox@sec.gov. SECURITIES AND EXCHANGE COMMISSION Dated: January 27, 2009. Florence E. Harmon, Deputy Secretary. [FR Doc. E9–2119 Filed 1–30–09; 8:45 am] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Approving a Proposed Rule Change To Amend Exchange Rule 4.21 Relating to Third Party Deposits BILLING CODE 8011–01–P January 27, 2009. SECURITIES AND EXCHANGE COMMISSION [File No. 500–1] In the Matter of: Leading Edge Packaging, Inc., Leadingside, Inc., Lecstar Corp., and Legal Club of America, Inc.; Order of Suspension of Trading dwashington3 on PROD1PC60 with NOTICES January 29, 2009. It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Leading Edge Packaging, Inc. because it has not filed any periodic reports since the period ended December 31, 1999. It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Leadingside, Inc. because it has not filed any periodic reports since the period ended September 30, 2000. It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Lecstar Corp. because it has not filed any periodic reports since the period ended September 30, 2002. It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Legal Club of America, Inc. because it has not filed any periodic reports since the period ended March 31, 2004. The Commission is of the opinion that the public interest and the protection of investors require a suspension of trading in the securities of the above-listed companies. Therefore, it is ordered, pursuant to Section 12(k) of the Securities Exchange Act of 1934, that trading in the securities of the above-listed companies is suspended for the period from 9:30 a.m. EST on January 29, 2009, through 11:59 p.m. EST on February 11, 2009. By the Commission. Florence E. Harmon, Deputy Secretary. [FR Doc. E9–2211 Filed 1–29–09; 11:15 am] BILLING CODE 8011–01–P VerDate Nov<24>2008 15:03 Jan 30, 2009 Jkt 217001 [Release No. 34–59300; File No. SR–CBOE– 2008–117] I. Introduction On December 2, 2008, the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend Exchange Rule 4.21 relating to third party deposits. The proposed rule change was published for comment in the Federal Register on December 23, 2008.3 The Commission received no comments on the proposal. This order approves the proposed rule change. II. Description of the Proposal Under current CBOE Rule 4.21, member organizations engaged in the business of clearing and carrying the accounts of options market makers (‘‘Clearing Firms’’) are prohibited (with certain exceptions) from accepting a check or funds transfer if the name on the account from which the funds are drawn is different (i.e., is from a ‘‘third party’’) from the name on the account cleared or carried by the Clearing Firm. CBOE proposes to amend the rule to permit Clearing Firms to accept for deposit to a broker-dealer account checks and funds transfers that: (i) Constitute an award or settlement paid as the result of the resolution of litigation or arbitration which arose in connection with the broker-dealer’s securities or futures business; (ii) are drawn on an account of the government of the United States; or (iii) are drawn on the account of another broker-dealer for satisfaction of the resolution of transaction disputes.4 The Exchange also proposes to clarify that documents evidencing that a deposit qualifies for acceptance under Rule 4.21, as well as 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 59104 (December 15, 2008), 73 FR 78862 (the ‘‘Notice’’). 4 The Exchange also notes that Clearing Firms, as a matter of business judgment, may still refuse to accept checks and/or funds transfers from third parties. See id. at 78863. PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 documents authorizing transfers between two accounts under Rule 4.21, must be retained by the Clearing Firm. The Exchange believes that the proposed exceptions do not present any of the concerns or business risks to the Clearing Firm that the rule was originally intended to address.5 III. Discussion and Commission Findings After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange.6 In particular, the Commission finds that the proposal is consistent with Section 6(b)(5) of the Act,7 which requires that an exchange have rules designed to promote just and equitable principles of trade, 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. The Commission believes that permitting Clearing Firms to accept for deposit these specific types of checks and fund transfers should streamline inter-member dealings without exposing Clearing Firms to the types of risks that the rule was designed to mitigate. Further, the proposed amendments to Interpretation and Policy .06 to Rule 4.21 are designed to ensure that Clearing Firms retain supporting documentation to evidence compliance with the rule. Accordingly, the Commission finds the proposed amendments to Rule 4.21 to be consistent with the Act. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,8 that the proposed rule change (SR–CBOE–2008– 117) be, and hereby is, approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Florence E. Harmon, Deputy Secretary. [FR Doc. E9–2160 Filed 1–30–09; 8:45 am] BILLING CODE 8011–01–P 5 See id. approving this proposed rule change, the Commission notes that it has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 7 15 U.S.C. 78f(b)(5). 8 15 U.S.C. 78s(b)(2). 9 17 CFR 200.30–3(a)(12). 6 In E:\FR\FM\02FEN1.SGM 02FEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 74, Number 20 (Monday, February 2, 2009)]
[Notices]
[Page 5874]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-2160]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59300; File No. SR-CBOE-2008-117]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Order Approving a Proposed Rule Change To Amend Exchange 
Rule 4.21 Relating to Third Party Deposits

January 27, 2009.

I. Introduction

    On December 2, 2008, the Chicago Board Options Exchange, 
Incorporated (``CBOE'' or the ``Exchange'') filed with the Securities 
and Exchange Commission (``Commission''), pursuant to Section 19(b)(1) 
of the Securities Exchange Act of 1934 (the ``Act'') \1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to amend Exchange Rule 4.21 
relating to third party deposits. The proposed rule change was 
published for comment in the Federal Register on December 23, 2008.\3\ 
The Commission received no comments on the proposal. This order 
approves the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 59104 (December 15, 
2008), 73 FR 78862 (the ``Notice'').
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II. Description of the Proposal

    Under current CBOE Rule 4.21, member organizations engaged in the 
business of clearing and carrying the accounts of options market makers 
(``Clearing Firms'') are prohibited (with certain exceptions) from 
accepting a check or funds transfer if the name on the account from 
which the funds are drawn is different (i.e., is from a ``third 
party'') from the name on the account cleared or carried by the 
Clearing Firm.
    CBOE proposes to amend the rule to permit Clearing Firms to accept 
for deposit to a broker-dealer account checks and funds transfers that: 
(i) Constitute an award or settlement paid as the result of the 
resolution of litigation or arbitration which arose in connection with 
the broker-dealer's securities or futures business; (ii) are drawn on 
an account of the government of the United States; or (iii) are drawn 
on the account of another broker-dealer for satisfaction of the 
resolution of transaction disputes.\4\ The Exchange also proposes to 
clarify that documents evidencing that a deposit qualifies for 
acceptance under Rule 4.21, as well as documents authorizing transfers 
between two accounts under Rule 4.21, must be retained by the Clearing 
Firm. The Exchange believes that the proposed exceptions do not present 
any of the concerns or business risks to the Clearing Firm that the 
rule was originally intended to address.\5\
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    \4\ The Exchange also notes that Clearing Firms, as a matter of 
business judgment, may still refuse to accept checks and/or funds 
transfers from third parties. See id. at 78863.
    \5\ See id.
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III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange.\6\ 
In particular, the Commission finds that the proposal is consistent 
with Section 6(b)(5) of the Act,\7\ which requires that an exchange 
have rules designed to promote just and equitable principles of trade, 
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.
---------------------------------------------------------------------------

    \6\ In approving this proposed rule change, the Commission notes 
that it has considered the proposed rule's impact on efficiency, 
competition, and capital formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78f(b)(5).
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    The Commission believes that permitting Clearing Firms to accept 
for deposit these specific types of checks and fund transfers should 
streamline inter-member dealings without exposing Clearing Firms to the 
types of risks that the rule was designed to mitigate. Further, the 
proposed amendments to Interpretation and Policy .06 to Rule 4.21 are 
designed to ensure that Clearing Firms retain supporting documentation 
to evidence compliance with the rule. Accordingly, the Commission finds 
the proposed amendments to Rule 4.21 to be consistent with the Act.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\8\ that the proposed rule change (SR-CBOE-2008-117) be, and hereby 
is, approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-2160 Filed 1-30-09; 8:45 am]
BILLING CODE 8011-01-P

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