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99-01 Office Of Disciplinary Affairs To Authorize All Enforcement Actions
Legal & Compliance
On December 30, 1998, the Securities and Exchange Commission (SEC) approved rule changes proposed by the National Association of Securities Dealers, Inc. (NASD®) that provide for the Office of Disciplinary Affairs (ODA) of NASD Regulation, Inc. (NASD RegulationSM) to authorize all disciplinary actions brought by the NASD.1 These amendments will be effective on January 1, 1999.
Questions regarding this Notice should be directed to Eric Moss, Assistant General Counsel, NASD Regulation, at (202) 728-8982.
Office Of Disciplinary Affairs As Case Authorizer
As of January 1, 1999, the ODA will authorize all disciplinary actions brought by the NASD. For the past year, the Case Authorization Unit (CAU), a division of the NASD Regulation Department of Enforcement, authorized all disciplinary actions brought by the NASD. The Office of Disciplinary Policy (ODP), which reported to the Office of the President of NASD Regulation, was the primary reviewer of cases developed in the Washington, D.C. office and those involving "quality-of-market" issues. The ODP also reviewed and commented on all cases involving policy issues.
To increase overall operating efficiency and to maintain the consistency and independence of the case authorization function, the NASD is placing the functions performed by the ODP and CAU in one office. Under the new rules, all cases will be authorized by the ODA, which will review the legal, policy, and consistency issues presented by each case.
The text of these rules that go into effect on January 1, 1999, is set forth in the remainder of this Notice.
Text Of Amendments
(Note: New text is underlined; deletions are bracketed.)
The term "Department of Enforcement" means the Department of Enforcement or its delegatee, the Department of Market Regulation[, except that the term excludes the Department of Market Regulation with respect to the actions of:
The term "Office of Disciplinary Affairs" means the Office of Disciplinary Affairs for NASD Regulation.
The term "Panelist," as used in the Rule 9200 Series, means a member of a Hearing Panel or Extended Hearing Panel who is not a Hearing Officer. As used in the Rule 9300 Series, the term means a current member of the National Adjudicatory Council, a former Director or a former Governor who is appointed to serve on a Subcommittee or an Extended Proceeding Committee.
With respect to a particular proceeding, the term "Party" means:
The term "Primary District Committee" means, in a disciplinary proceeding under the Rule 9200 Series, the District Committee designated by the Chief Hearing Officer pursuant to Rule 9232 to provide one or more of the Panelists to a Hearing Panel or, if applicable, to an Extended Hearing Panel, for such disciplinary proceeding.
The term "Respondent" means, in a disciplinary proceeding governed by the Rule 9200 Series and in an appeal or review governed by the Rule 9300 Series, an NASD member or associated person against whom a complaint is issued.
The term "Review Subcommittee" means a body appointed by the National Adjudicatory Council pursuant to Article V of the NASD Regulation By-Laws.
The term "Statutory Disqualification Committee" means a Subcommittee of the National Adjudicatory Council that makes a recommended decision to grant or deny an application for relief from the eligibility requirements of the Association to the National Adjudicatory Council pursuant to the Rule 9520 Series.
The term "Subcommittee" means an Adjudicator that is:
9200. DISCIPLINARY PROCEEDINGS
9210. Complaint and Answer
9211. Authorization of Complaint
1 Securities Exchange Act Rel. No.34-40864 (December 30, 1998) (File No.SR-NASD-98-90).