SEC to Exempt CUs From Broker Registration

WASHINGTON – After a five-year debate, the Securities and Exchange Commission finally proposed a rule yesterday that will exempt credit unions and banks from registering as brokers when offering investment services and products. If adopted by the SEC, the rule will free thousands of credit unions and CUSOs from the time-consuming and costly process of registration. The proposed rule will define exactly which activities credit unions and banks can engage in without registering with the SEC as brokers. The proposal, which has the support of the credit union lobby, was issued for a 90-day comment period. The proposal seeks to address provisions of the 1999 Gramm-Leach-Blilely Act, which left the SEC to determine how to regulate securities activities by banks.