Full text of District Notices (Federal Reserve Bank of Dallas) : Emergency Extensions of Time Under Regulation T, Circular No. 70-70

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F ederal Reserve Bank
DALLAS, TEXAS

of

Dallas

75222
Circular No. 70-70
March 20, 1970

EMERGENCY EXTENSIONS OF TIME UNDER REGULATION T

To All Broker/Dealers
in the Eleventh Federal Reserve District:

The following is a press release issued by the Board of Governors
on March 19, 1970:
The Board of Governors of the Federal Reserve System said
today that in view of the emergency situation created in New York
and some other areas by the interruption of postal service, stock
exchanges and the National Association of Securities Dealers may
grant blanket extensions of time for brokers and dealers to obtain
payment from customers affected by the work stoppage.
The Board’s Regulation T requires that broker/dealers must
obtain payment in margin account within five full business days
after a transaction takes place in the account, and must obtain
payment in not more than seven full business days after a trans­
action takes place in a cash account. Under the regulation, ex­
tensions of time for obtaining payment may be granted on an indi­
vidual basis by a committee of a national securities exchange, or
of the National Association of Securities Dealers, if exceptional
circumstances warrant the action. The blanket extensions of time
contemplated by the Board’s action would be available in advance
where the delay in payment is due to the interruption of postal
service and the firm has made every effort to collect the amount
that is due. The extensions could be granted for not more than
ten full business days after the emergency has ended.
Firms would not be required to apply in advance for such
extensions of time, but each firm would be required to keep de­
tailed records as to transactions in each customer's account,
identifying the date when payment was due under Regulation T,
and the date when payment was actually received. Copies of
these records should be submitted to the appropriate committee
of the stock exchange or the association within a reasonable
time, and the original record should be retained by the broker/
dealer for at least two years after the extension end.
For further information, contact the Regulations Department of the
Federal Reserve Bank of Dallas.
Yours very truly,
P. E. Coldwell
President

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