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NASD AND FEDERAL FINANCIAL INSTITUTION REGULATIORS SIGN AGREEMENT ON COORDINATING EXAMINATIONS
FOR IMMEDIATE RELEASE
The National Association of Securities Dealers (NASD) and the four
federal financial institution regulators have signed an agreement
in principle to coordinate their examinations of registered broker
dealers selling mutual funds and other nondeposit investment
products on the premises of depository institutions. The four
federal regulators are the Federal Reserve Board, the Federal
Deposit Insurance Corporation (FDIC), the Office of the Comptroller
of the Currency (OCC), and the Office of Thrift Supervision (OTS).
The NASD and the agencies share a common interest in the supervision of broker dealers affiliated with depository institutions, the agreement said. "To ensure that this common interest is addressed with a minimum of duplication of efforts...and to promote regulatory consistency and reduce unnecessary burdens, the banking agencies and the NASD agree in principle to cooperate...to facilitate the coordination, and enhance the effectiveness, of examination efforts by the banking agencies and the NASD."
To that end, the signatories agreed to take the following steps:
The NASD and the banking agencies will share examination schedules for depository institutions that have affiliated broker dealers. Either the NASD or the banking agency may request that an observer be present during an examination.
The NASD will provide banking agencies with access to NASD examination findings and workpapers for the most recent examination of an affiliated broker dealer.
The banking agencies will refer apparent violations of securities laws by affiliated broker dealers to the NASD.
The NASD will refer apparent violations of banking laws, regulations and guidelines by affiliated broker dealers to the appropriate banking agency.
The banking agencies and the NASD agreed to communicate with each other about activities of non-affiliated broker dealers selling non-deposit investment products on bank premises.
The banking agencies and the NASD agreed to communicate with each other about issues of common interest, such as regulatory and policy initiatives and educational efforts.
The banking agencies and the NASD agreed to maintain the confidentiality of information exchanged between them.
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