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95-38 Treasury Adopts Amendments To Form G-405 And Form G-FIN-4


Senior Management
Government Securities
Internal Audit
Legal & Compliance

Executive Summary

Effective June 12, 1995, the Department of the Treasury (Treasury) is adopting amendments to Form G-405, Report on Finances and Operations of Government Securities Brokers and Dealers (FOGS Report), and to Form G-FIN-4, Disclosure Form for Person Associated with a Financial Institution Government Securities Broker or Dealer. The amendments revise Schedule I of the FOGS Report to require sole government securities broker/dealers (GSBDs) registered pursuant to Section 15C of the Securities Exchange Act of 1934 (Exchange Act), to disclose any affiliations with U.S. banks. The changes to Form G-FD>M require associated persons to provide a more complete description of their disciplinary history.

Form G-405—Report On Finances And Operations Of Government Securities Brokers And Dealers

The Government Securities Act of 1986 (GSA) requires firms that are registered under Section 15C of the Exchange Act to use the FOGS Report to make monthly, quarterly, and annual financial reports to the Securities Exchange Commission (SEC) and their self-regulatory organization. To supplement Part II or IIA of the FOGS Report, registered GSBDs also must file Schedule I at the end of each calendar year.

The amendments to the report add a new question asking whether the GSBD is affiliated with, or controlled by, a U.S. bank. If the response is "yes," the GSBD must provide the name of the parent or affiliate and the type of institution. Also, there is an additional change to the Schedule's general instructions, referring to the definition of "bank" in Section 3(a)(6) of the Exchange Act.

These changes are consistent with similar changes made by the SEC to Form X-17A-5, the FOCUS Report, and assure equal treatment for all government securities broker/dealers.

Form G-FIN-4—Disclosure Form For Person Associated With A Financial Institution Government Securities Broker Or Dealer

Form G-FTN-4 is the form used by associated persons of GSBDs that are registered pursuant to Section 15C of the Exchange Act to file information concerning employment, residence, and statutory disqualification with their employer and the appropriate regulatory agencies. Associated persons that have a current Form U-4, Uniform Application for Securities Industry Registration or Transfer, or Form MSD-4, Uniform Application for Municipal Securities Principal or Municipal Securities Representative Associated with a Bank Municipal Securities Dealer, on file with their employer are not required to file Form G-FIN-4.

The changes to the form include:

  • Item 17, Question C is amended by adding paragraph (5), which asks the associated person whether the SEC or the Commodity Futures Trading Commission (CFTC) has ever imposed a civil money penalty on the associated person, or ordered the associated person to cease and desist from any activity.

  • Item 17, Question D adds a definition of "foreign financial regulatory authority," and now inquires whether the associated person has ever been the subject of a finding by any federal regulatory agency or "foreign financial regulatory authority."

  • Item 17, Questions A and B have been amended to clarify that the inquiries now apply to information related to foreign and domestic courts.

  • Item 5 is modified to reflect the Office of Thrift Supervision as the successor to the Federal Home Loan Bank Board. Thus, the "Director, Office of Thrift Supervision" is now listed as one of the appropriate regulatory agencies with which the financial institutions may be required to file the form.

  • Item 3 of the general instructions is changed to correspond with technical changes made by the Government Securities Act Amendments of 1993 to the definition of "appropriate regulatory agency."

These changes are consistent with similar changes that are made to Form U-4 and Form BD, Uniform Application for Broker/Dealer Registration.

Members should note that associated persons that have previously filed Form G-FIN-4 should review their filings to determine whether they contain all of the information required by amended Item 17. If the revisions to the form now require these persons to answer "yes" to a question in Item 17, they must file an amendment to their Form G-FIN-4 by June 12, 1995. Associated persons who continue to answer "no" to all of the questions in amended Item 17 are not required to file an updated form.

The NASD will distribute the amended Form G-405 to members that are sole GSBDs registered pursuant to Section 15C of the Exchange Act. Questions concerning the form should be directed to the NASD Regulatory Systems Department at (800) 321–6273. Copies of the new Form G-FTN-4 will be available through our Member Services Phone Center at (301) 590–6500.

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