April 18 2005

Ms. Joan F. Berger
Assistant Secretary
Sanford C. Bernstein & Co., LLC
New York, NY 10105

Dear Ms. Berger:

Based on the facts and representations set forth in your letter dated April 15, 2005,¹ we find that it is appropriate in the public interest and consistent with the protection of investors to grant, and hereby grant, to Sanford C. Bernstein and Co., LLC ("Bernstein"), an exemption, pursuant to Rule 10b-10(f) under the Securities Exchange Act of 1934 ("Exchange Act"), from the trade-by-trade confirmation delivery requirements of Rule 10b-10(a). In lieu of trade-by-trade confirmations, Bernstein will send those Bernstein clients that have granted Bernstein's parent company, Alliance Capital Management, L.P. ("Alliance"), investment discretion over their accounts ("Discretionary Clients"), and who have requested them, periodic statements not less often than monthly that contain all of the information required by Rule 10b-10 for transactions in securities (including options) effected by Bernstein in their accounts during the applicable period.

In particular, we note the following:

1. Bernstein will develop a form of written or electronic consent for Discretionary Clients to elect not to receive trade-by-trade confirmations and, in lieu thereof, receive a periodic statement that contains the same information that would have been in the trade-by-trade confirmation for each transaction. New Discretionary Clients will be able to elect to receive a periodic statement in lieu of trade-by-trade confirmations by executing a separate signature line, specifically providing for such consent, contained in the client's account opening documentation.
    
2. Discretionary Clients electing not to receive trade-by-trade confirmations could later change their minds and request, for no additional cost, trade-by-trade confirmations for any transaction since the date of the last periodic statement, as well as for all subsequent transactions. Bernstein will also inform Discretionary Clients that they may request, for no additional cost, trade-by-trade confirmations for previous transactions effected for up to a one-year period preceding the last periodic statement.
    
3. For Discretionary Clients making such election, Bernstein will send to the client all information required in such trade-by-trade confirmations in a periodic statement on at least a monthly basis.
    
4. Bernstein will inform Discretionary Clients that they may receive an interim update and further details concerning any transaction effected between periodic statements either by calling a Bernstein representative or by checking on BIRM's private client website, and Bernstein will provide such information at no additional cost. Discretionary Clients who enroll to access Bernstein's client website will be able to view, no later than the next business day after trade date ("T+ 1"), all information required to be disclosed under Rule 10b-10 on trades effected in their accounts. Discretionary Clients also will be able to obtain all required information either by telephoning their Bernstein account representative or by requesting a written trade-by-trade confirmation for the particular transaction.
    
5. Bernstein will continue to generate and send trade-by-trade confirmations for those Discretionary Clients who do not elect to receive periodic statements instead of trade-by-trade confirmations.
    
6. Bernstein will also continue to generate and retain, in accordance with Exchange Act Rules 17a-3 and 17a-4, trade-by-trade confirmations for Discretionary Clients who elect to receive periodic statements in lieu of trade-by-trade confirmations.
    
7. Bernstein will generate and send trade-by-trade confirmations to any third parties that serve as custodians for the accounts of any Discretionary Clients.
    
8. Bernstein will not require or request that Discretionary Clients elect not to receive trade-by-trade confirmations, but will make information available on how such clients could make such an election. Bernstein client communications will inform existing and new Discretionary Clients about their ability to receive confirmations on a trade-by-trade basis or in periodic statements, but will not suggest which choice is better. Such client communications also will inform Discretionary Clients that, if interested, they should contact a Bernstein representative to obtain more information or to obtain a copy of a written or electronic consent to request a periodic statement in lieu of trade-by-trade confirmations. These client communications will not suggest that such an election is required for Discretionary Clients or that the clients will incur additional costs if they do not elect to receive periodic statements rather than trade-by-trade confirmations.
    

This exemption from Rule 10b-10 is based solely upon the representations you have made and is limited strictly to the facts and conditions described in your letter. In the event that a material change occurs with respect to any of the facts or representations presented, periodic statements should be discontinued and the use of trade-by-trade confirmations should be reinstated for the transactions described above pending presentation of the facts for our consideration. The Division of Market Regulation expresses no view with respect to other questions Bernstein's activities may raise, including the applicability of any other federal or state laws or the applicability of self-regulatory organization rules concerning customer account statements or confirmations.

Endnotes

---

¹ Terms not otherwise defined in this letter have the meanings set forth in your letter.

² 17 CFR 200.30-3(a)(32).

Incoming Letter:

Catherine McGuire
Associate Director and Chief Counsel
Division of Market Regulation
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-1001

Dear Ms. McGuire:

Sanford C. Bernstein & Co., LLC ("Bernstein" or the "Firm") requests an exemption, pursuant to Rule 10b-10(f) of the Securities Exchange Act of 1934 ("Exchange Act"), from the trade-by-trade confirmation delivery requirements in Rule 10b-10(a) of the Exchange Act for transactions in securities, including options, in accounts for which Bernstein's parent company, Alliance Capital Management L.P. ("Alliance"), exercises investment discretion. Bernstein requests this relief to permit it to send requesting clients, instead of trade-by-trade confirmations, a periodic statement not less often than monthly, that contains all of the information required by Rule 10b-10(a), for discretionary transactions,¹ effected in their account during the applicable period.

Introduction

Bernstein is a broker-dealer registered with the Securities and Exchange Commission ("Commission") pursuant to Section 15(b) of the Exchange Act, and is a member of the New York Stock Exchange, Inc. ("NYSE") and the National Association of Securities Dealers, Inc. ("NASD"). Bernstein and Alliance are investment advisers registered with the Commission pursuant to Section 203(c) of the Investment Advisers Act of 1940 ("Advisers Act"). Alliance is a leading global investment management firm that provides investment management services to a broad range of clients worldwide.

Alliance provides investment management services to private clients consisting of high net worth individuals, trusts and estates, charitable foundations, partnerships, and private and family corporations and other similar entities. Alliance provides investment management services to these private clients through its Bernstein Investment Research and Management unit ("BIRM"). Pursuant to tri-party account agreements among private clients, BIRM and Bernstein, private clients of BIRM and Bernstein ("Discretionary Clients") grant Alliance investment discretion over their Bernstein brokerage accounts,² thereby choosing to rely on Alliance to provide ongoing oversight and to make and effect related investment decisions for their accounts.³ Bernstein would like to offer these Discretionary Clients the option to suppress trade-by-trade confirmations if they prefer to monitor their accounts only periodically through their account statements or otherwise through the information BIRM makes available to its clients.

Bernstein's Proposal

Bernstein proposes to make available to Discretionary Clients the ability to receive, instead of trade-by-trade confirmations, a periodic statement, not less often than monthly, containing the information that would have been required to be disclosed in trade-by-trade confirmations pursuant to Rule 10b-10 absent the requested relief. In implementing this proposal:

• Bernstein would develop a form of written or electronic consent for Discretionary Clients to elect not to receive trade-by-trade confirmations and, in lieu thereof, receive a periodic statement that contains the same information that would have been in the trade-by-trade confirmation for each transaction.⁴
   
• Bernstein would inform Discretionary Clients that they could receive an interim update and further details concerning any transaction effected between periodic statements either by calling a Bernstein representative or by checking on BIRM's private client website,⁵ and Bernstein would provide such information at no additional cost.
   
• Bernstein would not require or request that Discretionary Clients elect not to receive trade-by-trade confirmations, but would make information available on how such clients could make such an election. Bernstein client communications would inform existing and new Discretionary Clients about their ability to receive confirmations on a trade-by-trade basis or in periodic statements, but would not suggest which choice is best. Such client communications also would inform Discretionary Clients that, if interested, they should contact a Bernstein representative to obtain more information or to obtain a copy of a written or electronic consent to request a periodic statement in lieu of trade-by-trade confirmations. These client communications would not suggest that such an election is required for Discretionary Clients or that the clients would incur additional costs if they did not elect to receive periodic statements rather than trade-by-trade confirmations.
   
• Discretionary Clients electing not to receive trade-by-trade confirmations could later change their minds and request, for no additional cost, trade-by-trade confirmations for any transaction since the date of the last periodic statement, as well as for all subsequent transactions. Bernstein will also inform clients that they may request, for no additional cost, trade-by-trade confirmations for previous transactions effected for up to a one-year period preceding the last periodic statement.
   
• For Discretionary Clients making such election, Bernstein would send to the client all information required in such trade-by-trade confirmations in a periodic statement on at least a monthly basis.
   
• Bernstein would continue to generate and send trade-by-trade confirmations for those Discretionary Clients who do not elect to receive periodic statements instead of trade-by-trade confirmations. Bernstein would also continue to generate and retain, in accordance with Exchange Act Rules 17a-3 and 17a-4, trade-by-trade confirmations for Discretionary Clients who elect to receive periodic statements in lieu of trade-by-trade confirmations.
   
• Bernstein would generate and send trade-by-trade confirmations to any third parties that serve as custodians for the accounts of any Discretionary Clients.
   

Prior Commission Action

Rule 10b-10(a) under the Exchange Act requires a broker-dealer to send trade-by-trade confirmations to its client at or before completion of each transaction. In various circumstances, the Commission and its staff have permitted broker-dealers to send the trade-by-trade confirmation either to a fiduciary with investment discretion over the account or to a third party other than the client. For example, where an account is managed by an investment adviser, a broker-dealer may send that trade-by-trade confirmation to the client's investment adviser instead of the client, provided that the broker-dealer sends the client a periodic statement, not less than quarterly, that contains all of the information required for each included transaction by Rule 10b-10.⁶ Moreover, in certain circumstances a broker-dealer may send a trade-by-trade confirmation to an account's third-party custodian that is authorized to receive securities and disburse funds for the account.⁷

The Commission staff, pursuant to delegated authority,⁸ has permitted broker-dealers to send to clients a periodic statement in lieu of trade-by-trade confirmations where the broker-dealer was dually registered as an investment adviser or where an investment adviser affiliated with the broker-dealer managed the account.⁹ Moreover, the staff has granted an exemption on behalf of certain broker-dealer sponsors of wrap fee programs, permitting such broker-dealers to confirm transactions in wrap fee programs through periodic statements in lieu of trade-by-trade confirmations.¹⁰ Outside of this wrap fee context, the staff has granted an exemption to a registered broker-dealer from the trade-by-trade requirements of Rule 10b-10 where the broker-dealer may be exercising investment discretion over a customer's account, and where the broker-dealer may be acting as principal in transactions with the customer's account.¹¹ The relief requested here by Bernstein is similar to that previously granted by the staff.

Conclusion

Bernstein believes that, under the terms of the proposed exemption, Discretionary Clients will be provided the investor protections contemplated by Rule 10b-10 without obligating such clients to receive trade-by-trade confirmations where they have elected to forego day-to-day monitoring of their account through trade-by-trade confirmations. The proposal will not diminish Bernstein's clients' right to receive confirmations on request if desired, and it will give clients the option to rely on a periodic statement instead.

We welcome the opportunity to discuss this request with you. If you have any questions regarding this request, please telephone me or Robert De Leon at Bernstein. On behalf of Bernstein, we appreciate the Staff's consideration of this request.

Endnotes

---

¹ Where the Bernstein client exercises trading discretion, Bernstein will send a trade-by- trade confirmation consistent with Rule 10b-10. Bernstein is only requesting relief from Rule 10b-10 for trades entered subject to Alliance's investment discretion. The Firm does not effect transactions for discretionary private clients pursuant to hold-in-custody repurchase agreements. If it did, Bernstein would send trade-by-trade confirmations pursuant to Rule 15c3-3(b)(4) of the Exchange Act.

² Although Bernstein is a registered adviser, Bernstein will not exercise investment discretion over accounts that are the subject of this request for exemptive relief.

³ As an operating unit of Alliance, BIRM is not separately registered with the Commission.

⁴ New Discretionary Clients may be able to elect to receive a periodic statement in lieu of trade-by-trade confirmations by executing a separate signature line, specifically providing for such consent, contained in the client's account opening documentation.

⁵ Bernstein makes confirmations available on its client website. Discretionary Clients who enroll to access Bernstein's client website will be able to view, on the next business day after trade date ("T+1"), all information required to be disclosed under Rule 10b-10 on trades effected in their accounts. Discretionary Clients also will be able to obtain all required information either by telephoning their Bernstein account representative or by requesting a written trade-by-trade confirmation for the particular transaction.

⁶ See Securities Exchange Act Release No. 34962 (November 10, 1994).

⁷ Id.

⁸ See 17 C.F.R. § 200.30-3(a)(32).

⁹ See Donaldson, Lufkin & Jenrette Securities Corporation, 1997 SEC No-Act. LEXIS 1093 (August 21, 1997); Scudder Investor Services, Inc., 1998 SEC No-Act. LEXIS 191 (February 11, 1998); Advest, Inc., 1999 SEC No-Act. LEXIS 664 (July 19,1999).

¹⁰ See Money Management Institute, Securities Industry Association, 1999 SEC No-Act. LEXIS 934 (August 23, 1999).

¹¹ See Goldman Sachs & Co., 2003 SEC No-Act. LEXIS 676 (August 14, 2003).

http://www.sec.gov/divisions/marketreg/mr-noaction/bernstein041805.htm