SEC Says Never Mind' on CSAs.(commission sharing arrangements)(Securities and Exchange Commission)

Traders, September, 2006 by Bresiger, Gregory

Small, introducing brokers can continue their commission sharing arrangements (CSAs), according to the Securities and Exchange Commission's interpretative release on soft dollars.

The SEC, which issued the release in late July, is in the process of re-examining Section 28(e). This rule allows alternative commission arrangements, but the SEC had wanted to impose stiff new requirements on mom-and-pop introducing brokers that work with bigger brokerages.

"The SEC did a 180-degree flip," said William Edick, an attorney with the Washington-based Alliance in Support of Independent Research. His group helped argued that introducing brokers using CSAs are critically important for managers needing independent research and for obtaining best executions.

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