MSRB to Amend Rule G-40 to Match FINRA Rules

The Municipal Securities Rulemaking Board yesterday filed with the Securities and Exchange Commission amendments to its Rule G-40 on e-mail contacts that would bring the rule more in line with Financial Industry Regulatory Authority requirements. The rule requires dealers to appoint a primary contact for all electronic communications between themselves and the MSRB. The amendments would require broker-dealers to: update any change in the required information for their primary contact within 30 days of a change; review and if necessary update required information on their primary contact within 17 business days after the end of each calendar year; and comply with any request by the market’s regulatory agencies for such information within 15 days, “or such longer period that may be agreed to by the appropriate regulatory agency,” the MSRB release said in a release.The board proposed that the amendments become effective on Dec. 31, to coincide with recently approved FINRA requirements. “The MSRB attempts, whenever possible, to adopt rule provisions and language similar to FINRA rules in order to facilitate dealer understanding of and compliance with such provisions,” the MSRB said. Rule G-40 was originally crafted in the wake of the Sept. 11, 2001, terrorist attacks and required municipal securities dealers to appoint an individual to serve as the contact person to receive electronic communications from the board. Yesterday’s amendments, if approved by the SEC, would replace language from an amendment adopted in 2005 that required each dealer to conduct a quarterly review of its primary contact information. The new language will still require that the dealer’s primary contact be either a Series 53-registered municipal securities principal or a Series 51-registered municipal fund securities limited principal.