TECHNICAL AMENDMENT FILED: RULE G-9

(Volume 16, Number 2) JUNE 1996

TECHNICAL AMENDMENT FILED: RULE G-9

Route To: Manager, Muni Department Operations Compliance

Amendment Filed The proposed amendment to rule G-9 would require that dealers retain the records required by rule G-8(a)(xv), concerning the sending of Forms G-36(OS) and G-36(ARD), for a period of three years.

On June 3, 1996, the Board filed with the Securities and Exchange Commission (SEC or Commission) a proposed amendment to rule G-9 on preservation of records.[1] The Board has requested that the proposed amendment be made operative 30 days after filing with the Commission.

Among other things, Board rule G-36 requires that, with certain exceptions, each dealer acting as an underwriter in a primary offering of municipal securities submit a copy of the final official statement, if one is prepared, to the Board. Underwriters also are required to send advance refunding documents to the Board if an issue advance refunds an outstanding issue of municipal securities.

Rule G-8(a)(xv) requires that dealers maintain a record of the sending of the Forms G-36(OS) and G-36(ARD) and the corresponding required documentation to the Board. Rule G-9, on preservation of records, currently does not state a time period for preservation of these records.

The proposed amendment to rule G-9 would require that dealers retain the records required by rule G-8(a)(xv) for a period of three years. This three year period would coincide with the record retention requirement for the documentation supporting proof of delivery of official statements to purchasers of new issue securities as required by rule G-32 on disclosures in connection with new issues.

TEXT OF PROPOSED AMENDMENT (Language between asterisks is proposed new language: language between {brackets} is proposed deleted language)

Rule G-9. Preservation of Records (a) No change. (b) Records to be Preserved for Three Years. Every municipal securities broker and municipal securities dealer shall preserve the following records for a period of not less than three years: (i) - (vii) No change. (viii) the following records, to the extent made or received by such municipal securities broker or municipal securities dealer in connection with its business as such municipal securities broker or municipal securities dealer and not otherwise described in this rule: (A) check books, bank statements, canceled checks, cash reconciliations and wire transfers; (B) bills receivable or payable; (C) all written communications received and sent, including inter-office memoranda, relating to the conduct of the activities of such municipal securities broker or municipal securities dealer with respect to municipal securities; {and} (D) all written agreements entered into by such municipal securities broker or municipal securities dealer, including agreements with respect to any account; and (E) all powers of attorney and other evidence of the granting of any authority to act on behalf of any account, and copies of resolutions empowering an agent to act on behalf of a corporation. (ix) all records relating to fingerprinting which are required pursuant to paragraph (e) of rule 17f-2 under the Act{.}*;* (x) all records of deliveries of rule G-32 disclosures required to be retained described in rule G-8(a)(xiii){.}*; and* * (xi) the records to be maintained pursuant to rule G-8(a)(xv).* (c) - (g) No change.

June 3, 1996

ENDNOTES

[1] File No. SR-MSRB-96-3. Comments submitted to the Commission should refer to this file number.

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