[ by Howard Haykin ]

Managing Director Leslie Norwood, writing on SIFMA's behalf, provided comments to the MSRB on draft amendments to Rule G-37 that would impact political contributions and prohibitions on municipal securities business, bond ballot campaign committee contributions. [MSRB Reg'y Notice 2012-43]  As proposedl MSRB would require an increase in the type of information publicly disclosed by brokers, dealers and municipal securities dealers regarding any contributions to bond ballot campaigns.

SIFMA and its members generally support transparency as a way to eliminate any possible perception of impropriety and had supported the MSRB’s initial disclosure regime for bond ballot campaign contributions.  However, that was then and this is now.  SIFMA has some concerns about specific aspects of the amendments.

The Comment Letter, delivered to MSRB Corporate Secretary Ronald Smith on 9/17/12, starts off with the proposal to revised the term, "contribution," to cover the full range of cash an in-kind contributions that might be given in the context of a bond ballot campaign and, with regard to in-kind contributions, require dealers to disclose both the value and nature of the services being provided by the dealer or its personnel, including election services or other collateral work provided on behalf of the issuer or bond ballot campaign.  That's asking brokers, dealers and others to do a lot more work and it relates solely to bon ballot campaigns. 

Other Proposed Requirements: For, Against, An Added Suggestion. SIFMA also expresses concerns with new proposed requirements pertaining to:  (i) complete date of engagement and (ii) disclosing the specific date a contribution was made. 

SIFMA and its members agree with the proposed requirement to: (i) disclose reimbursements, and (ii) provide the name of issuer.

Ms. Norwood concludes the letter by asking for the MSRB to include provisions for a level playing field for regulated players.  To that end, any of these amendments that impact dealers, as well as the rest of the provisions of Rule G-37, should also be applied to municipal advisors as soon as practicable.

For further details, go to:  [SIFMA Comment Letter, 9/17/12].