An exempted borrower is a member of a national securities exchange or a registered broker or dealer who:
A.
Maintains at least 1,000 active accounts annually for persons other than brokers, dealers, and persons associated with brokers and dealers
B.
Earns at least $10 million in gross revenues on an annual basis from transactions with persons other than brokers, dealers, and persons associated with brokers and dealers, or
C.
Earns at least 10 percent of its gross revenues on an annual basis from transactions with persons other than brokers, dealers, and persons associated with brokers and dealers
The criteria provided in options A, B, and C do not accurately describe the conditions under which a member of a national securities exchange or a registered broker or dealer would be considered an exempted borrower under the usual regulatory frameworks such as Regulation U, which deals with credit issued for the purpose of buying or carrying margin stock. Exempted borrowers are typically defined by criteria related to their regulatory status or specific exemptions provided under securities or banking regulations, not by the number of active accounts they maintain or the proportion of their revenues derived from transactions with non-brokers or non-dealers.
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Cam22
4 months ago