SEC Grants No-Action Relief Relating to Certain Bank Sweep Receivables

The SEC Division of Trading and Markets ("DTM") granted no-action relief regarding the net capital treatment of certain receivables from bank sweep programs.

In response to a request from the SIFMA Capital Steering Committee, the DTM granted relief from Exchange Act Rule 15c3-1 ("Net capital requirements for brokers or dealers") to permit broker-dealers to treat receivables from a bank sweep account, established pursuant to Exchange Act Rule 15c3-3(a)(17), as an "allowable asset" and not a deduction from net worth amounts for one business day from the date the receivable is created. DTM conditioned the relief on the following:

  • the receivable is created because the broker-dealer is pre-funding a customer account as part of the return of cash to the customer under a 15c3-3 sweep program;

  • the receivable originates from an FDIC-insured bank for which a 15c3-3 sweep program is established;

  • the broker-dealer is legally entitled to enforce payment on the receivable from the bank; and

  • the customer is unable to directly access the sweep account.

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