December 22, 2000, 3:01 PM — The Securities and Exchange Commission (SEC) yesterday approved new rules that will allow it to shut down
non-Y2K-compliant brokerage firms and transfer agents on Dec. 1.
Firms have until Aug. 31 to complete their year 2000 projects, but unprepared firms will have until Nov. 15 to show they are year 2000-compliant, the SEC said yesterday in a statement. The rules apply only to mission-critical systems, the government agency added.
"A few firms' lack of readiness could have adverse consequences for countless others," said Arthur Levitt, chairman of the SEC. "We simply cannot allow firms to continue to operate if they threaten the integrity of the system, or if they are not able to assure customers' access to their funds and securities."
The SEC said its own mission-critical systems are 84% compliant as of now, and will be fully compliant by Aug. 31.
Back in June, the government agency first revealed it was contemplating the new rules. These steps are the latest by the SEC to force companies to reveal their year 2000 status. The SEC fined 37 brokerage firms for not disclosing information on year 2000 projects.