General Rules and Regulations
promulgated
under the
Securities Exchange Act of 1934
Rule 3a5-1 -- Exemption from the Definition of "Dealer" for a Bank Engaged
in Riskless Principal Transactions
A bank is exempt from the definition of the term
"dealer" to the extent that it engages in or effects riskless principal transactions
if the number of such riskless principal transactions during a calendar year combined
with transactions in which the bank is acting as an agent for a customer pursuant
to section 3(a)(4)(B)(xi) of the Act
during that same year does not exceed 500.
For purposes of this section, the term riskless
principal transaction means a transaction in which, after having received
an order to buy from a customer, the bank purchased the security from another
person to offset a contemporaneous sale to such customer or, after having received
an order to sell from a customer, the bank sold the security to another person
to offset a contemporaneous purchase from such customer.
Notice to Users: The Deskbook is made available
with the understanding that the University of Cincinnati College
of Law is not engaged in rendering legal, accounting or other professional
services. If legal advice or other expert assistance is required,
the services of a competent professional person should be sought. See Terms and Conditions of Use.
