RegAlert2007-05-24
Added · Updated
SEC no-action letter: UBS Financial Services Inc. exemption from Rule 10b-10(a)
The SEC Division of Market Regulation grants UBS Financial Services Inc. an exemption from trade-by-trade confirmation delivery requirements under Rule 10b-10(a) for clients in wrap fee programs where UBSFS exercises investment discretion. UBSFS may send periodic monthly statements in lieu of individual trade confirmations, provided clients explicitly elect this option and receive specific disclosures regarding their rights to request confirmations at no cost. The exemption allows UBSFS to omit certain data points, such as trade dates, mark-ups, and debt security ratings, from these monthly statements, while maintaining website access to full trade information by the next business day. This relief extends to all dual-registered broker-dealers and investment advisers acting as fiduciaries in discretionary programs who satisfy the outlined conditions.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
DIVISION OF
MARKET REGULATION
May 24,2007
Jack P. Drogin, Esq.
Morgan, Lewis & Bockius LLP
1 Pennsylvania Avenue, NW
Washington, DC 20004
Re: Request for Exemption from Rule lob-10(a) for UBS Financial Services Inc.
Dear Mr. Drogin:
Based on the facts and representations set forth in your letter of May 21,2007, we find that is appropriate in the public interest and consistent with the protection of investors to grant, and hereby grant, an exemption, pursuant to Rule lob-10(f) under the Securities Exchange Act of 1934 ("Exchange Act"), from the trade-by-trade confirmation delivery requirements of Rule lob10(a) so that UBS Financial Services Inc. ("UBSFS"), a registered broker-dealer, may send clients participating in wrap fee programs for which UBSFS exercises investment discretion (each a "Program"), who have requested them, periodic statements not less often than monthly (each, a "Monthly Statement"), in lieu of trade-by-trade confirmations. The Monthly Statements will contain all of the information required by Rule lob-10(a), subject to exceptions specified below. This exemption is subject to the following conditions:
- UBSFS will provide all Program clients, at or prior to account opening, and at
least annually thereafter offer to provide, a brochure describing the products, services, and fees of the Program, in accordance with Advisers Act Rule 204-3. - UBSFS will develop a form of written or electronic consent that will be
prominent, clear and easily understandable for Program clients who request not to receive trade-by-trade confirmations and, in lieu thereof, receive a Monthly Statement that contains the information required by Rule lob-10, subject to the exceptions specified below.' I Program clients will elect to receive from UBSFS a Monthly Statement in lieu of trade-by-trade confirmations by checking a box on the client's Application or other account opening documentation next to specific text indicating this election. In connection with a broader account opening initiative, UBSFS may use an account opening process whereby Program clients would discuss their client account selections,
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