SEC Expands Small Broker-Dealer Exemption from Risk Assessment Reporting

The SEC raised the exemption threshold for broker-dealers required to comply with certain obligations under SEA Rules 17h-1T ("Risk Assessment Recordkeeping Requirements") and 17h-2T ("Risk Assessment Reporting Requirements").

The exemption threshold will be raised on firms that maintain $20 million to $50 million in capital, contingent on the broker-dealer maintaining less than $1 billion in total assets. The increase in the exemption threshold "is intended to reduce the number of broker-dealers subject to the rules without materially increasing risk."