
    RMJ Securities Corp., Respondent, v Cantor Fitzgerald, L. P., et al., Appellants.
    [654 NYS2d 376]
   Order, Supreme Court, New York County (Leland Degrasse, J.), entered on or about July 1, 1996, which, in an action between government securities dealers for unfair competition, denied defendants’ motion to compel arbitration, unanimously affirmed, with costs.

There is no merit to defendants’ contention that rules of the National Association of Securities Dealers (NASD), in which the parties are members, require arbitration of this dispute. Government securities dealers are exempt from the Securities Exchange Act of 1934 (15 USC § 78c [a] [12] [A] [i]; [42]) and its amendments (15 USC § 78o-3 [f]), under which the NASD’s rule-making authority is derived, and the record shows that NASD has never imposed its arbitration code on government securities dealers. We would also note that NÁSD’s rule-making authority is restricted to prohibiting fraudulent practices against the investing public and discipline (see, Harden v Raffensperger, Hughes & Co., 65 F3d 1392, 1397), matters not implicated in the instant dispute. We have considered defendants’ remaining claims and find them to be without merit. Concur—Sullivan, J. P., Milonas, Rosenberger and Rubin, JJ.  