$341.3 Registration as securities transfer agent.

(a) Requirement for registration. Any insured nonmember bank which performs any of the functions of a transfer agent as described in § 341.2(a) with respect to qualifying securities shall register with the FDIC in the manner indicated in this section.

(b) Application to register as transfer agent. An application for registration under section 17A(c) of the Act, of a transfer agent for which the FDIC is the appropriate regulatory agency, as defined in section 3(a)(34)(B)(iii) of the Act, shall be filed with the FDIC at its Washington, D.C. headquarters on Form TA-1, in accordance with the instructions contained therein.

(c) Effective date of registration. Registration shall become effective 30 days after the date an application on Form TA-1 is filed unless the FDIC accelerates, denies, or postpones such registration in accordance with section 17A(c) of the Act. The effective date of such registration may be postponed by order for a period not to exceed 15 days. Postponement of registration for more than 15 days shall be after notice and opportunity for hearing. Form TA-1 is available upon request from the Review Unit, Division of Bank Supervision, FDIC, Washington, DC 20429.

§341.4 Amendments to registration.

(a) Within 60 calendar days following the date which any information reported on Form TA-1 becomes inaccurate, misleading, or incomplete, the registrant shall file an amendment on Form TA-1 correcting the inaccurate, misleading, or incomplete information.

(b) The filing of an amendment to an application for registration as a transfer agent under § 341.3, which registration has not become effective, shall postpone the effective date of the registration for 30 days following the date on which the amendment is filed unless the FDIC accelerates, denies, or postpones the registration in accordance with section 17A(c) of the Act.

[47 FR 38106, Aug. 30, 1982, as amended at 52 FR 1182, Jan. 12, 1987]

§ 341.5 Withdrawal from registration.

(a) Notice of withdrawal from registration. Any transfer agent registered under this part that ceases to engage in the functions of a transfer agent as defined in § 341.2(a) shall file a written notice of withdrawal from registration with the FDIC. A registered transfer agent that ceases to engage in one or more of the functions of transfer agent as defined in § 341.2(a), but continues to engage in another such function, shall not withdraw from registration.

(b) A notice of withdrawal shall be filed with the FDIC at its Washington, D.C. headquarters. Deregistration shall be effective upon receipt of notice of withdrawal by the FDIC. A Request for Deregistration form is available from the Review Unit, Division of Bank Supervision, FDIC, Washington, DC 20429.

(c) If the FDIC finds that any registered transfer agent for which it is the ARA, is no longer in existence or has ceased to do business as a transfer agent, FDIC shall cancel or deny the registration by order of the Board of Directors.

(d) Registration of a transfer agent with another ARA shall cancel registration of the transfer agent with FDIC.

AUTHORITY: Secs. 1A, 19 and 23 of the Securities Exchange Act of 1934; 15 U.S.C. 78q-1, 78s and 78w.

SOURCE: 42 FR 19325, Apr. 13, 1977, unless otherwise noted.

§ 342.1 Scope of part.

This part is ussued by the Federal Deposit Insurance Corporation (the "Corporation") pursuant to sections 17A, 19 and 23 of the Securities Exchange Act of 1934 as amended (15 U.S.C. 780 (the "Act"). It applies to applications by banks insured by the Corporation (other than members of the Federal Reserve System) for a stay or review of certain actions by clearing agencies registered under the Act for which the Securities and Exchange Commission is not the appropriate regulatory agency under section 3(a)(34)(B) of the Act ("bank clearing agencies").

§ 342.2 Applications for stays of disciplinary sanctions or summary suspensions by a bank clearing agency.

If any bank clearing agency imposes any final disciplinary sanction pursuant to section 17A(b)(3)(G) of the Act, or summarily suspends or limits or prohibits access pursuant to section 17A(b)(5)(C) of the Act, any person aggrieved thereby for which the Corporation is the appropriate regulatory agency may file with the Corporation, by telegram or otherwise, a request for a stay of imposition of such action. Such request shall be in writing and shall include a statement as to why such stay should be granted.

§ 342.3 Applications for review of final disciplinary sanctions, denials of participation, or prohibitions or limitations of access to services imposed by bank clearing agencies.

(a) Proceedings on an application to the Corporation under section 19(d)(2) of the Act for review of any final disciplinary sanction, denial or conditioning of participation, or prohibition or limitation with respect to access to services offered by a bank clearing agency shall be governed by this section.

(b) An application for review pursuant to section 19(d)(2) of the Act shall be filed with the Corporation within

30 days after notice thereof was filed pursuant to section 19(d)(1) of the Act and received by the aggrieved person applying for review, or within such longer period as the Corporation may determine. The Executive Secretary of the Corporation shall serve a copy of the application on the bank clearing agency, which shall, within ten days after receipt of the application, certify and file with the Corporation one copy of the record upon which the action complained of was taken, together with three copies of an index to such record. The Executive Secretary shall serve upon the parties copies of such index and any papers subsequently filed.

(c) Within 20 days after receipt of copy of the index, the applicant shall file a brief or other statement in support of his application which shall state the specific grounds on which the application is based, the particular findings of the bank clearing agency to which objection is taken and the relief sought. Any application not perfected by such timely brief or statement may be dismissed as abandoned.

(d) Within 20 days after receipt of the applicant's brief or statement the bank clearing agency may file an answer thereto, and within 10 days of receipt of any such answer the applicant may file a reply. Any such papers not filed within the time provided by paragraphs (b), (c), or (d) of this section will not be received except upon special permission of the Corporation.

(e) On its own motion, the Corporation may direct that the record under review be supplemented with such additional evidence as it may deem relevant. Nevertheless, the bank clearing agency and persons who may be aggrieved by its actions shall be obliged to present all evidence that they deem relevant in the proceedings before the bank clearing agency, and no such person shall be entitled to present additional evidence unless he shows to the satisfaction of the Corporation that such additional evidence is material and that there were reasonable grounds for his failure to present such evidence in such proceedings. Any request for leave to present additional evidence shall be filed promptly so as

not to delay the disposition of the proceeding.

(f) Oral argument before the Corporation may be requested by the applicant or the bank clearing agency as follows: (1) By the applicant with his brief or statement or within 10 days after receipt of the bank clearing agency's answer, or (2) by the bank clearing agency with its answer. The Corporation, in its discretion, may grant or deny any request for oral argument and, where it deems it appropriate to do so, the Corporation will consider an application on the basis of the papers filed by the parties, without oral argument.

(g) The rules of practice contained in Part 308 shall apply to review proceedings under this rule to the extent that they are not inconsistent with this section. Attention is directed particularly to § 308.20 of these regulations relating to the form of papers and number of copies to be filed.

PART 343-INSURED STATE NONMEMBER BANKS WHICH ARE MUNICIPAL SECURITIES DEALERS

Sec.

343.1 Scope of part.

343.2 Definitions.

343.3 Filing of Form MSD-4, Amending Statements, and Form MSD-5.

AUTHORITY: 15 U.S.C. 780-4(c)(5), 78q, and 78w; 12 U.S.C. 1811 et seq.

SOURCE: 42 FR 40891, Aug. 12, 1977, unless otherwise noted.

§ 343.1 Scope of part.

(a) This part is issued by the Federal Deposit Insurance Corporation (the "Corporation") pursuant to those provisions of the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) which provide for the regulation of bank municipal securities dealers and their activities.

(b) This part shall apply to all State banks insured by the Federal Deposit Insurance Corporation and not a member of the Federal Reserve System, or separately identifiable departments or divisions of such banks, which act as municipal securities deal

ers.

§ 343.3 Filing of Form MSD-4, Amending Statements, and Form MSD-5.

(a) On and after September 15, 1977, an insured State nonmember bank, or a subsidiary or a department or a division thereof, which is a municipal securities dealer shall not permit a person to be associated with it as a municipal securities principal or municipal securities representative unless it has filed with the Corporation an original and two copies of Form MSD4, "Uniform Application for Municipal Securities Principal or Municipal Securities Representative Associated with a Bank Municipal Securities Dealer", completed in accordance with the instructions contained therein, for that person. Form MSD-4 is prescribed by the Corporation for purposes of paragraph (b) of Municipal Securities Rulemaking Board Rule G7, "Information Concerning Associated Persons".

(b) Whenever a bank municipal securities dealer receives a statement pursuant to paragraph (c) of Municipal Securities Rulemaking Board Rule G7, "Information Concerning Associated Persons" ("amending statement"), from a person for whom it has filed a Form MSD-4 with the Corporation pursuant to paragraph (a) of this section, such dealer shall, within ten days thereafter, file three copies of the amending statement with the Corporation accompanied by an original and two copies of a transmittal letter which includes the name of the dealer and a reference to the material transmitted, identifying the person involved, and is signed by a municipal securities principal associated with the dealer.

(c) Within thirty days after the termination of the association of a municipal securities principal or munici

pal securities representative with a bank municipal securites dealer which has filed a Form MSD-4 with the Corporation for that person pursuant to paragraph (a) of this section, such dealer shall file an orignial and two copies of a notification of termination with the Corporation on Form MSD-5, "Uniform Termination Notice for Municipal Securities Principal or Municipal Securities Representative Associated with a Bank Municipal Securities Dealer", completed in accordance with the instructions contained therein.

(d) A bank municipal securities dealer which files a Form MSD-4, Form MSD-5, or an amending statement with the Corporation under this part shall retain for its own records a copy of each such Form MSD-4, Form MSD-5, or amending statement for at least three years after termination of the associated person with respect to whom the filing was made.

(e) Forms MSD-4, Forms MSD-5 and amending statements are to be filed with Director, Division of Bank Supervision, Federal Deposit Insurance Corporation, Washington, DC 20429. The date that the Corporation receives a Form MSD-4, Form MSD-5, or amending statement shall be the date of filing. A Form MSD-4, Form MSD-5, or amending statement which is not prepared and executed in accordance with the applicable requirements may be returned as unacceptable for filing. Acceptance for filing shall not constitute any finding that a Form MSD-4, Form MSD-5 or amending statement has been completed in accordance with the applicable requirements or that any information contained therein is true, complete or not misleading. Every Form MSD-4, Form MSD-5, or amending statement filed with the Corporation under this part shall constitute a filing with the Securities and Exchange Commission for purposes of section 17(c)(1) of the Act (15 U.S.C. 78q(c)(1)) and a "report", "application", or "document" within the meaning of section 32(a) of the Act (15 U.S.C. 78ff(a)). Forms MSD-4 and MSD-5 can be obtained from the FDIC regional office for the area in which the bank is located.

current,

§ 344.1 Purpose and scope.

(a) Purpose. The purpose of this part is to ensure that purchasers of securities in transactions effected by an insured nonmember bank are provided adequate information concerning the transactions. This part is also designed to ensure that insured nonmember banks maintain adequate records and controls with respect to securities transactions they effect.

(b) Scope. This part is issued by the Federal Deposit Insurance Corporation ("FDIC") and applies to insured banks which are not members of the Federal Reserve System (“bank”).

§ 344.2 Definitions.

For purposes of this part:

(a) "Collective investment fund" means funds held by a bank as fiduciary and, consistent with local law, invested collectively: (1) In a common trust fund maintained by such bank exclusively for the collective investment and reinvestment of monies contributed thereto by the bank in its capacity as trustee, executor, administrator, guardian, or custodian under the Uniform Gifts to Minors Act, or (2) in a fund consisting solely of assets of retirement, pension, profit sharing, stock bonus or similar trusts which are exempt from Federal income taxation under the Internal Revenue Code;

(b) "Customer" shall mean any person or account, including any agency, trust, estate, guardianship, committee or other fiduciary account,

for which a bank effects or participates in effecting the purchase or sale of securities, but shall not include a broker, dealer, dealer bank or issuer of the securities which are the subject of the transactions;

(c) A bank shall be deemed to exercise "investment discretion" with respect to an account if, directly or indirectly, the bank: (1) Is authorized to determine what securities or other property shall be purchased or sold by or for the account, or (2) makes recommendations as to what securities or other property shall be purchased or sold by or for the account even though some other person may have responsibility for such investment decisions.

(d) "Periodic plan" means any written authorization for a bank acting as agent to purchase or sell for a customer, a specific security or securities, in specific amounts (calculated in security units or dollars) or (to the extent of dividends and funds available) at specific time intervals, and setting forth the commission or charges to be paid by the customer in connection therewith, or the manner of calculating them;

(e) "Security" means any interest or instrument commonly known as a "security," whether in the nature of debt or equity, including any stock, bond, note, debenture, evidence of indebtedness or any participation in or right to subscribe to or purchase any of the foregoing. The term "security" does not include: (1) A deposit or share account in a federally insured depository institution, (2) a loan participation, (3) a letter of credit or other form of bank indebtedness incurred in the ordinary course of business, (4) currency, (5) any note, draft, bill of exchange, or bankers acceptance which has a maturity at the time of issuance of not exceeding nine months, exclusive of days of grace, or any renewal thereof the maturity of which is likewise limited, (6) units of a collective investment fund, (7) interests in a variable amount (master) note of a borrower of prime credit or (8) U.S. Savings Bonds.

§ 344.3 Recordkeeping.

Every bank effecting securities transactions for customers shall main

tain the following records of those transactions for at least three years:

(a) Chronological records of original entry containing an itemized daily record of all purchases and sales of securities. These shall include the account for which each such transaction was effected, the description of the securities, the unit and aggregate purchase or sale price (if any), the trade date, and the name or other designation of the broker/dealer or other person from whom purchased or to whom sold;

(b) Account records for each customer which shall reflect all purchases and sales of securities, all receipts and deliveries of securities, and all other debits and credits pertaining to each account including all receipts and disbursements of cash;

(c) A separate memorandum (order ticket) of each order to purchase or sell securities (whether executed or cancelled), which shall include:

(1) The accounts for which the transaction was effected;

(2) Whether the transaction was a market order, limit offer, or subject to special instructions;

(3) The time the order was received by the trader or other bank employee responsible for effecting the transaction;

(4) The time the order was placed with the broker/dealer, or if there was no broker/dealer, the time the order was executed or cancelled;

(5) The price at which the order was executed; and

(6) The broker/dealer utilized;

(d) A record of all broker/dealers selected by the bank to effect securities transactions and the amount of commissions paid or allocated to each broker during the calendar year.

Nothing contained in paragraph (d) of this section shall require a bank to maintain the records required by this section in any given manner, Provided, That the information required to be shown is clearly and accurately reflected and provides an adequate basis for the audit of such information.

[44 FR 43261, July 24, 1979; 44 FR 45375, Aug. 2, 1979]