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New SEC Rule 15c3-5 Bans Unfiltered Market Access
On November 3, 2010, the SEC voted unanimously to adopt the new Rule 15c3-5 under the Exchange Act, effectively eliminating "naked" or unfiltered market access. Unfiltered market access is the practice of providing customers or other persons with direct access to the market without first going through a broker or dealer's pre-trade risk checks. The new rule requires that broker-dealers that provide access to customers or other persons to trade a security directly on an exchange or alternative trading system must have certain risk controls in place.
In general, the compliance date for Rule 15c3-5 is July 14, 2011. On June 27, 2011 the SEC extended the compliance date for certain requirements of Rule 15c3-5 until November 30, 2011.
