On June 29, 2005, the SEC issued for comment a set of proposals by the NASD that would amend the NASD's requirements on Anti-Money Laundering (AML) Compliance Programs (Rule 3011), and adopt new related interpretive material (“IM”), to: (1) require each member to conduct an independent test of its AML program on an annual basis (or, in certain cases, every two years); (2) clarify which persons will not be considered to be independent for purposes of Rule 3011(c) (and therefore would not be eligible to conduct the test); and (3) require a member to review, and if necessary, update, the accuracy of its AML compliance person information on a quarterly basis. Release No. 34-51935; available at http://www.sec.gov/rules/sro/nasd/34-51935.pdf. The text of the proposed changes, including the proposed new IM, is available at http://www.nasd.com/web/groups/rules_regs/documents/rule_filing/nasdw_014236.pdf.

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