Risk Management Controls for Brokers or Dealers with Market Access (US Securities and Exchange Commission Regulation) (SEC) (2018 Edition‪)‬

The Law Library presents the complete text of the Risk Management Controls for Brokers or Dealers with Market Access (US Securities and Exchange Commission Regulation) (SEC) (2018 Edition).
Updated as of May 29, 2018

The Securities and Exchange Commission (“Commission” or “SEC”) is adopting new Rule 15c3-5 under the Securities Exchange Act of 1934 (“Exchange Act”). Rule 15c3-5 will require brokers or dealers with access to trading securities directly on an exchange or alternative trading system (“ATS”), including those providing sponsored or direct market access to customers or other persons, and broker-dealer operators of an ATS that provide access to trading securities directly on their ATS to a person other than a broker or dealer, to establish, document, and maintain a system of risk management controls and supervisory procedures that, among other things, are reasonably designed to systematically limit the financial exposure of the broker or dealer that could arise as a result of market access, and ensure compliance with all regulatory requirements that are applicable in connection with market access. The required financial risk management controls and supervisory procedures must be reasonably designed to prevent the entry of orders that exceed appropriate pre-set credit or capital thresholds, or that appear to be erroneous. The regulatory risk management controls and supervisory procedures must also be reasonably designed to prevent the entry of orders unless there has been compliance with all regulatory requirements that must be satisfied on a pre-order entry basis, prevent the entry of orders that the broker or dealer or customer is restricted from trading, restrict market access technology and systems to authorized persons, and assure appropriate surveillance personnel receive immediate post-trade execution reports.

This ebook contains:
- The complete text of the Risk Management Controls for Brokers or Dealers with Market Access (US Securities and Exchange Commission Regulation) (SEC) (2018 Edition)
- A dynamic table of content linking to each section
- A table of contents in introduction presenting a general overview of the structure