PART B.5 - MARGIN REQUIREMENTS

4365. No confirmation from securities location

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    1. Security positions where the Dealer Member has not received:

      1. a positive fiscal year end audit confirmation under subsection 4356(2) or where an adequate month-end reconciliation process is not performed by the Dealer Member,

      2. a confirmation from a transfer agent, within the required time period, under subsection 4357(3), 4358(3) or 4359(3), or

      3. a confirmation of a related stock split or stock dividend under subsection 4360(2)

    2. are not considered to be under the Dealer Member’s control or physical possession for purposes of good segregation and must be transferred to a Dealer Members difference account.

    3. For difference account positions in subsection 4365(1), the Dealer Member must:

      1. provide for the purposes of calculating risk adjusted capital, as an amount required to margin, the sum of the security position market value and the normal inventory margin, and

      2. undertake to borrow or buy-in the position pursuant to section 4368.

    There is no history log for this rule.