Source: https://uscode.house.gov/view.xhtml?req=granuleid%3AUSC-prelim-title15-chapter2B-1&saved=%7CZ3JhbnVsZWlkOlVTQy1wcmVsaW0tdGl0bGUxNS1zZWN0aW9uNzhnZ2c%3D%7C%7C%7C0%7Cfalse%7Cprelim&edition=prelim
Timestamp: 2020-04-07 17:04:45
Document Index: 735136972

Matched Legal Cases: ['§3', '§2', '§1', '§203', '§2', '§3', '§4', '§4', '§5', '§4', '§929', '§929', '§6', '§6', '§6', '§6', '§6', '§7', '§308', '§308', '§308', '§308', '§308', '§308', '§308', '§7', '§308', '§308', '§308', '§983', '§929', '§1', '§1', '§308', '§308', '§12', '§929', '§929', '§13', '§13', '§13', '§14', '§16', '§12', '§16', '§9', '§308', '§7', '§802', '§1', '§203', '§983', '§983', '§983', '§983', '§983', '§77', '§308', '§308']

[USC02] 15 USC Ch. 2B-1: SECURITIES INVESTOR PROTECTION
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15 USC Ch. 2B-1: SECURITIES INVESTOR PROTECTION
Except as otherwise provided in this chapter, the provisions of the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.] (hereinafter referred to as the "1934 Act") apply as if this chapter constituted an amendment to, and was included as a section of, such Act.
There is hereby established a body corporate to be known as the "Securities Investor Protection Corporation" (hereafter in this chapter referred to as "SIPC"). SIPC shall be a nonprofit corporation and shall have succession until dissolved by Act of the Congress. SIPC shall—
(7) subject to the provisions of subsection (c), to elect or appoint such officers, attorneys, employees, and agents as may be required, to determine their qualifications, to define their duties, to fix their salaries, require bonds for them and fix the penalty thereof;
The Board of Directors of SIPC shall file with the Commission a copy of any proposed bylaw or any proposed amendment to or repeal of any bylaw of SIPC (hereinafter in this paragraph collectively referred to as a "proposed bylaw change"), accompanied by a concise general statement of the basis and purpose of such proposed bylaw change. Each such proposed bylaw change shall take effect thirty days after the date of the filing of a copy thereof with the Commission, or upon such later date as SIPC may designate or such earlier date as the Commission may determine, unless—
The Board of Directors of SIPC shall file with the Commission, in accordance with such rules as the Commission may prescribe, a copy of any proposed rule or any proposed amendment to or repeal of any rule of SIPC (hereinafter in this subsection collectively referred to as a "proposed rule change"), accompanied by a concise general statement of the basis and purpose of such proposed rule change. The Commission shall, upon the filing of any proposed rule change, publish notice thereof, together with the terms of substance of such proposed rule change or a description of the subjects and issues involved. The Commission shall give interested persons an opportunity to submit written data, views, and arguments with respect to such proposed rule change. No proposed rule change shall take effect unless approved by the Commission or otherwise permitted in accordance with the provisions of this paragraph.
(Pub. L. 91–598, §3, Dec. 30, 1970, 84 Stat. 1637; Pub. L. 95–283, §§2–5, May 21, 1978, 92 Stat. 249–251; Pub. L. 106–554, §1(a)(5) [title II, §203(d)(2)], Dec. 21, 2000, 114 Stat. 2763, 2763A-424.)
This chapter, referred to in subsecs. (a) to (c) and (e), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
1978—Subsec. (a). Pub. L. 95–283, §2(a), substituted "Creation and membership" for "Creation" in heading, redesignated introductory text and cls. (1) and (3) as par. (1), and added par. 2 which incorporated provisions formerly contained in cl. (2) as par. (2)(A).
Subsec. (b). Pub. L. 95–283, §3, in par. (1) substituted "State, Federal, or other court" for "court, State, or Federal", in par. (3) substituted provisions relating to adoption, etc., of bylaws by the Board of Directors, for provisions relating to adoption, etc., of bylaws and rules by the Board of Directors, added par. (4), and redesignated former pars. (4) to (8) as (5) to (9), respectively.
Subsec. (c)(2)(C)(ii). Pub. L. 95–283, §4(a), substituted "a broker or dealer or associated with a member of a national securities exchange, within the meaning of section 78c(a)(18) or section 78c(a)(21), respectively, of this title, or similarly associated with any self-regulatory organization or other securities industry group," for "any broker or dealer, within the meaning of paragraph (18) of section 78c(a) of this title, or similarly associated with a national securities exchange or other securities industry group".
Subsec. (c)(5). Pub. L. 95–283, §4(b), substituted "Compensation" for "Compensation, etc." in heading, and in text struck out provisions relating to determinations of dollar volume of trading on exchanges.
Subsec. (e). Pub. L. 95–283, §5, inserted "and rules" after "Bylaws" in heading, and in text substituted provisions relating to procedures applicable to proposed changes in the bylaws and rules of SIPC and required action by the Commission with respect to any SIPC bylaw or rule, for provisions relating to procedures applicable to adoption of initial bylaws and rules of SIPC and any alteration, supplement, repeal, or addition, effective date of any such bylaw or rule, and required action by the Commission with respect to any SIPC bylaw or rule.
SIPC shall, by bylaw, impose upon its members such assessments as, after consultation with self-regulatory organizations, SIPC may deem necessary and appropriate to establish and maintain the fund and to repay any borrowings by SIPC. Any assessments so made shall be in conformity with contractual obligations made by SIPC in connection with any borrowing incurred by SIPC. Subject to paragraph (3) and subsection (d)(1)(A), any such assessment upon the members, or any one or more classes thereof, may, in whole or in part, be based upon or measured by (A) the amount of their gross revenues from the securities business, or (B) all or any of the following factors: the amount or composition of their gross revenues from the securities business, the number or dollar volume of transactions effected by them, the number of customer accounts maintained by them or the amounts of cash and securities in such accounts, their net capital, the nature of their activities (whether in the securities business or otherwise) and the consequent risks, or other relevant factors.
Subject to subsection (c)(3), SIPC shall impose upon each of its members an assessment at a rate of not less than one-half of 1 per centum per annum of the gross revenues from the securities business of such member—
There may be contributed and transferred at any time to SIPC any funds held by any trust established by a self-regulatory organization prior to January 1, 1970, and the amounts so contributed and transferred shall be applied, as may be determined by SIPC with approval of the Commission, as a reduction in the amounts payable pursuant to assessments made or to be made by SIPC upon members of such self-regulatory organization pursuant to subsection (c)(2). No such reduction shall be made at any time when there is outstanding any borrowing by SIPC pursuant to subsection (g) of this section or any borrowings under confirmed lines of credit.
SIPC shall have the power to borrow moneys and to evidence such borrowed moneys by the issuance of bonds, notes, or other evidences of indebtedness, all upon such terms and conditions as the Board of Directors may determine in the case of a borrowing other than pursuant to subsection (g) of this section, or as may be prescribed by the Commission in the case of a borrowing pursuant to subsection (g). The interest payable on a borrowing pursuant to subsection (g) shall be equal to the interest payable on the related notes or other obligations issued by the Commission to the Secretary of the Treasury. To secure the payment of the principal of, and interest and premium, if any, on, all bonds, notes, or other evidences of indebtedness so issued, SIPC may make agreements with respect to the amount of future assessments to be made upon members and may pledge all or any part of the assets of SIPC and of the assessments made or to be made upon members. Any such pledge of future assessments shall (subject to any prior pledge) be valid and binding from the time that it is made, and the assessments so pledged and thereafter received by SIPC, or any collection agent for SIPC, shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of such pledge shall be valid and binding against all parties having claims of any kind against SIPC or such collection agent whether pursuant to this chapter, in tort, contract or otherwise, irrespective of whether such parties have notice thereof. During any period when a borrowing by SIPC pursuant to subsection (g) of this section is outstanding, no pledge of any assessment upon a member to secure any bonds, notes, or other evidences of indebtedness issued other than pursuant to subsection (g) of this section shall be effective as to the excess of the payments under the assessment on such member during any twelve-month period over one-fourth of 1 per centum of such member's gross revenues from the securities business for such period. Neither the instrument by which a pledge is authorized or created, nor any statement or other document relative thereto, need be filed or recorded in any State or other jurisdiction. The Commission may by rule or regulation provide for the filing of any instrument by which a pledge or borrowing is authorized or created, but the failure to make or any defect in any such filing shall not affect the validity of such pledge or borrowing.
In the event that the fund is or may reasonably appear to be insufficient for the purposes of this chapter, the Commission is authorized to make loans to SIPC. At the time of application for, and as a condition to, any such loan, SIPC shall file with the Commission a statement with respect to the anticipated use of the proceeds of the loan. If the Commission determines that such loan is necessary for the protection of customers of brokers or dealers and the maintenance of confidence in the United States securities markets and the SIPC has submitted a plan which provides as reasonable an assurance of prompt repayment as may be feasible under the circumstances, then the Commission shall so certify to the Secretary of the Treasury, and issue notes or other obligations to the Secretary of the Treasury pursuant to subsection (h). If the Commission determines that the amount or time for payment of the assessments pursuant to such plan would not satisfactorily provide for the repayment of such loan, it may, by rules and regulations, impose upon the purchasers of equity securities in transactions on national securities exchanges and in the over-the-counter markets a transaction fee in such amount as at any time or from time to time it may determine to be appropriate, but not exceeding one-fiftieth of 1 per centum of the purchase price of the securities. No such fee shall be imposed on a transaction (as defined by rules or regulations of the Commission) of less than $5,000. For the purposes of the next preceding sentence, (1) the fee shall be based upon the total dollar amount of each purchase; (2) the fee shall not apply to any purchase on a national securities exchange or in an over-the-counter market by or for the account of a broker or dealer registered under section 78o(b) of this title unless such purchase is for an investment account of such broker or dealer (and for this purpose any transfer from a trading account to an investment account shall be deemed a purchase at fair market value); and (3) the Commission may, by rule, exempt any transaction in the over-the-counter markets or on any national securities exchange where necessary to provide for the assessment of fees on purchasers in transactions in such markets and exchanges on a comparable basis. Such fee shall be collected by the broker or dealer effecting the transaction for or with the purchaser, or by such other person as provided by the Commission by rule, and shall be paid to SIPC in the same manner as assessments imposed pursuant to subsection (c) but without regard to the limits on such assessments, or in such other manner as the Commission may by rule provide.
To enable the Commission to make loans under subsection (g), the Commission is authorized to issue to the Secretary of the Treasury notes or other obligations in an aggregate amount of not to exceed $2,500,000,000, in such forms and denominations, bearing such maturities, and subject to such terms and conditions, as may be prescribed by the Secretary of the Treasury. Such notes or other obligations shall bear interest at a rate determined by the Secretary of the Treasury, taking into consideration the current average market yield on outstanding marketable obligations of the United States of comparable maturities during the month preceding the issuance of the notes or other obligations. The Secretary of the Treasury may reduce the interest rate if he determines such reduction to be in the national interest. The Secretary of the Treasury is authorized and directed to purchase any notes and other obligations issued hereunder and for that purpose he is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under chapter 31 of title 31, and the purposes for which securities may be issued under that chapter are extended to include any purchase of such notes and obligations. The Secretary of the Treasury may at any time sell any of the notes or other obligations acquired by him under this subsection. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes or other obligations shall be treated as public debt transactions of the United States.
This chapter, referred to in subsecs. (a)(1), (4), (c)(3), (g), and (i)(1), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
In subsec. (h), "chapter 31 of title 31" and "that chapter" substituted for "the Second Liberty Bond Act, as amended" and "that Act, as amended,", respectively, on authority of Pub. L. 97–258, §4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which enacted Title 31, Money and Finance.
2010—Subsec. (d)(1)(C). Pub. L. 111–203, §929V(a), substituted "0.02 percent of the gross revenues from the securities business of such member of SIPC" for "$150 per annum".
Subsec. (h). Pub. L. 111–203, §929C, substituted "$2,500,000,000" for "$1,000,000,000" in first sentence.
1978—Subsec. (a). Pub. L. 95–283, §6(a), in par. (2) substituted "Except as otherwise provided in this section, the" for "The", in par. (2)(C) inserted provisions for inapplicability to other lines of credit, and added par. (4).
Subsec. (c). Pub. L. 95–283, §6(b), in par. (2) struck out "or rule" after "bylaw", and in par. (3) struck out reference to section 78ccc(f) of this title in introductory text and "or rule" after "bylaw" in subpar. (B).
Subsec. (e). Pub. L. 95–283, §6(d), in par. (2) substituted "be recoverable only against future payments by such member, except as otherwise provided by SIPC bylaw" for "not be recoverable except against future payments by such member in accordance with a bylaw or rule of SIPC", and in par. (3) substituted provisions authorizing interest and penalty charges to be imposed by SIPC bylaw and amount of penalty charge, for provisions authorizing interest to be imposed by SIPC bylaw or rule.
Subsec. (f). Pub. L. 95–283, §6(e), struck out "examining authority as" before "collection agent for SIPC, shall immediately be subject".
Subsec. (i). Pub. L. 95–283, §6(g), substituted "Consolidated group" for " 'Gross revenues' defined" in heading, redesignated par. (2) as entire section and, as so redesignated, substituted provisions relating to computations by a member, for provisions relating to computations by a broker or dealer. Pars. (1) and (3), which generally defined term "gross revenues" and authorized the SIPC to define all other terms used in this subsec., respectively, were struck out.
If a self-regulatory organization has given notice to SIPC pursuant to subsection (a)(1) with respect to a broker or dealer, and such broker or dealer undertakes to liquidate or reduce its business either pursuant to the direction of a self-regulatory organization or voluntarily, such self-regulatory organization may render such assistance or oversight to such broker or dealer as it considers appropriate to protect the interests of customers of such broker or dealer. The assistance or oversight by a self-regulatory organization shall not be deemed the assumption or adoption by such self-regulatory organization of any obligation or liability to customers, other creditors, shareholders, or partners of the broker or dealer, and shall not prevent or act as a bar to any action by SIPC.
(B) 2 one or more of the conditions specified in subsection (b)(1) exist with respect to such member.
(A) may, with the consent of the Commission, be combined with any action brought by the Commission, including an action by the Commission for a temporary receiver pending an appointment of a trustee under subsection (b)(3); and
Upon receipt of an application by SIPC under subsection (a)(3), the court shall forthwith issue a protective decree if the debtor consents thereto, if the debtor fails to contest such application, or if the court finds that such debtor—
(i) Notwithstanding section 362 of title 11, neither the filing of an application under subsection (a)(3) nor any order or decree obtained by SIPC from the court shall operate as a stay of any contractual rights of a creditor to liquidate, terminate, or accelerate a securities contract, commodity contract, forward contract, repurchase agreement, swap agreement, or master netting agreement, as those terms are defined in sections 101, 741, and 761 of title 11, to offset or net termination values, payment amounts, or other transfer obligations arising under or in connection with one or more of such contracts or agreements, or to foreclose on any cash collateral pledged by the debtor, whether or not with respect to one or more of such contracts or agreements.
(iii) As used in this subparagraph, the term "contractual right" includes a right set forth in a rule or bylaw of a derivatives clearing organization (as defined in the Commodity Exchange Act [7 U.S.C. 1 et seq.]), a multilateral clearing organization (as defined in the Federal Deposit Insurance Corporation Improvement Act of 1991), a national securities exchange, a national securities association, a securities clearing agency, a contract market designated under the Commodity Exchange Act, a derivatives transaction execution facility registered under the Commodity Exchange Act, or a board of trade (as defined in the Commodity Exchange Act), or in a resolution of the governing board thereof, and a right, whether or not in writing, arising under common law, under law merchant, or by reason of normal business practice.
This chapter, referred to in subsecs. (b)(2)(A)(iii), (5)(C), and (c), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
2010—Subsec. (a)(3). Pub. L. 111–203 designated existing provisions as subpar. (A) relating to general rule, inserted heading, substituted "SIPC may, upon notice to a member of SIPC, file an application for a protective decree with any court of competent jurisdiction specified in section 78u(e) or 78aa of this title, except that no such application shall be filed with respect to a member, the only customers of which are persons whose claims could not be satisfied by SIPC advances pursuant to section 78fff–3 of this title, if SIPC determines that—" for "If SIPC determines that—", in subpar. (A) relating to failure to meet obligations, substituted "the member" for "any member of SIPC", in subpar. (B) relating to conditions, substituted period for comma at end, added subpar. (B) relating to consent requirement, and struck out concluding provisions which read as follows: "SIPC may, upon notice to such member, file an application for a protective decree with any court of competent jurisdiction specified in section 78u(e) or 78aa of this title, except that no such application shall be filed with respect to a member the only customers of which are persons whose claims could not be satisfied by SIPC advances pursuant to section 78fff–3 of this title."
2006—Subsec. (b)(2)(C)(iii). Pub. L. 109–390 inserted "a derivatives clearing organization (as defined in the Commodity Exchange Act), a multilateral clearing organization (as defined in the Federal Deposit Insurance Corporation Improvement Act of 1991)," after "rule or bylaw of" and substituted "a securities clearing agency, a contract market designated under the Commodity Exchange Act, a derivatives transaction execution facility registered under the Commodity Exchange Act, or a board of trade (as defined in the Commodity Exchange Act)," for "or a securities clearing agency, a right set forth in a bylaw of a clearing organization or contract market".
1978—Subsec. (a). Pub. L. 95–283, §7(a), added par. (2), redesignated former par. (2) as (3) and, as so redesignated, revised format of provisions by setting out cls. (A) and (B) and inserted provisions relating to any person who was a member within 180 days prior to such determination and provisions relating to claims filed under section 78fff–3 of this title, and redesignated former par. (3) as (4) and, as so redesignated, substituted "with respect to a member of SIPC filed with a court under paragraph (3)" for "under paragraph (2)" in introductory text and inserted "may," before "with the" in cl. (A).
Subsec. (b)(1)(A). Pub. L. 95–598, §308(a)(1), substituted "section 101 of title 11" for "the Bankruptcy Act".
Subsec. (b)(2)(A)(iii). Pub. L. 95–598, §308(b), substituted "the United States having jurisdiction over cases under title 11" for "bankruptcy by the Bankruptcy Act".
Subsec. (b)(2)(B)(iii). Pub. L. 95–598, §308(c), substituted "any right of setoff, except to the extent such right may be affected under section 553 of title 11, and shall not abrogate" for "the right of setoff provided in section 68 of the Bankruptcy Act".
Subsec. (b)(3). Pub. L. 95–598, §308(d), substituted "section 322 of title 11" for "the applicable provisions of the Bankruptcy Act".
Subsec. (b)(5)(B). Pub. L. 95–598, §308(f)(1), (2), (5), redesignated subpar. (C) as (B) and substituted "title 11 governing applications for allowances under such title" for "the Bankruptcy Act governing applications for allowances under such Act". Former subpar. (B), which covered allowances to a referee in bankruptcy or special master, was struck out.
Subsec. (b)(5)(C). Pub. L. 95–598, §308(f)(2), (3), (5), redesignated subpar. (D) as (C) and substituted "subparagraph (B)" for "subparagraph (C)". Former subpar. (C) redesignated (B).
Subsec. (b)(5)(D). Pub. L. 95–598, §308(f)(2), (4), (5), redesignated subpar. (E) as (D) and substituted "Section 504 of title 11" for "the Bankruptcy Act". Former subpar. (D) redesignated (C).
Subsec. (b). Pub. L. 95–283, §7(b), in par. (1) inserted "protective" after "of" in heading and substituted provisions relating to issuance of protective decrees, for provisions relating to specific findings necessary for issuance of a decree and uncontested, etc., applications, in par. (2) substituted "Jurisdiction and powers of court" for "Exclusive jurisdiction over debtor" in heading and substituted provisions setting forth jurisdiction and powers of court with respect to exclusivity of such jurisdiction, for provisions relating to exclusive jurisdiction over the debtor, in par. (3) inserted "and attorney" after "trustee" in heading and substituted provisions relating to appointment of trustee and attorney, for provisions relating to appointment of trustee, in par. (4) substituted "Reference to referee in bankruptcy" for "Debtor and filing date defined" in heading and substituted provisions relating to reference to referee in bankruptcy, for provisions defining terms "debtor" and "filing date", and added pars. (5) and (6).
2 So in original. Probably should be "(ii)".
All costs and expenses of administration of the estate of the debtor and of the liquidation proceeding shall be borne by the general estate of the debtor to the extent it is sufficient therefor, and the priorities of distribution from the general estate shall be as provided in section 726 of title 11. Costs and expenses of administration shall include payments pursuant to section 78fff–2(e) of this title and section 78fff–3(c)(1) of this title (to the extent such payments recovered securities which were apportioned to the general estate pursuant to subsection (d)) and costs and expenses of SIPC employees utilized by the trustee pursuant to section 78fff–1(a)(2) of this title. All funds advanced by SIPC to a trustee for such costs and expenses of administration shall be recouped from the general estate under section 507(a)(2) of title 11.
This chapter, referred to in subsecs. (a)(1), (3), (b), (c), and (d), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
2005—Subsec. (e). Pub. L. 109–8 substituted "507(a)(2)" for "507(a)(1)".
1978—Pub. L. 95–283 substituted "General provisions of a liquidation proceeding" for "Liquidation proceedings" in section catchline.
Subsec. (a). Pub. L. 95–283 in heading substituted "Purposes" for "General purposes of liquidation proceeding", in introductory text substituted provisions relating to purposes of liquidation proceedings under this chapter, for provisions relating to purposes of any proceeding in which a trustee has been appointed under section 78eee(b)(3) of this title, in par. (1) substituted provisions requiring execution of authorities to deliver customer name securities and distribute customer property in accordance with this chapter, for provisions requiring execution of authorities to return specifically identifiable property and distribute the single and separate fund in accordance with this section, and in par. (2) substituted provisions authorizing sale, etc., of productive units of the debtor, for provisions authorizing operation of the business of the debtor.
Subsec. (b). Pub. L. 95–598, §308(g), in heading substituted "title 11" for "Bankruptcy Act" and in text "under chapters 1, 3, and 5 and subchapters I and II of chapter 7 of title 11. For the purposes of applying such title in carrying out this section, a reference in such title to the date of the filing of the petition shall be deemed to be a reference to the filing date under this chapter." for "under, the Bankruptcy Act. For purposes of applying the Bankruptcy Act to this chapter, any reference in the Bankruptcy Act to the date of commencement of proceedings under the Bankruptcy Act shall be deemed to be a reference to the filing date under this chapter."
Pub. L. 95–283 in heading substituted "Application of Bankruptcy Act" for "Powers and Duties of Trustee", and in text substituted provisions relating to applicability of Bankruptcy Act to liquidation proceedings, for provisions relating to the powers and duties of trustees. See section 78fff–1 of this title.
Subsec. (c). Pub. L. 95–283 in heading substituted "Determination of customer status" for "Application of Bankruptcy Act", and in text substituted provisions relating to determination of status of a customer with respect to cash or securities, for provisions setting forth general and special provisions of the Bankruptcy Act applicable to liquidation proceedings, and defining terms for purposes of such applicability and the provisions of this section. See subsec. (b) of this section and section 78fff–2(c) of this title.
Subsec. (d). Pub. L. 95–283 in heading substituted "Apportionment" for "Completion of open contractual commitments", and in text substituted provisions relating to apportionment of cash or securities remaining after the liquidation of a lien or pledge made by a debtor, for provisions relating to completion by the trustee of open contractual commitments, which were made in the ordinary course of the debtor's business and which were outstanding on the filing date. See section 78fff–2(e) of this title.
Subsec. (e). Pub. L. 95–598, §308(h), substituted in first sentence "section 726 of title 11" for "the Bankruptcy Act" and in last sentence "under section 507(a)(1) of title 11" for "as a first priority under the Bankruptcy Act".
Pub. L. 95–283 in heading substituted "Costs and expense of administration" for "Notice", and in text substituted provisions relating to costs and expenses of administration of the estate of the debtor and of the liquidation proceeding, for provisions relating to notice requirements for the trustee subsequent to appointment as trustee. See section 78fff–2(a)(l) of this title.
Subsec. (f). Pub. L. 95–283 struck out subsec. (f) requiring advances by the SIPC to the trustee for customers' claims and completion of open contractual commitments, and authorizing discretionary advances to the trustee for compensation of personnel deemed necessary for the liquidation proceeding. See section 78fff–3 of this title.
1978—Subsec. (a). Pub. L. 95–598, §308(i), substituted "trustee in a case under title 11" for "trustee in bankruptcy under the Bankruptcy Act has with respect to a bankrupt and the property of a bankrupt".
After receipt of a written statement of claim pursuant to subsection (a)(2), the trustee shall promptly discharge, in accordance with the provisions of this section, all obligations of the debtor to a customer relating to, or net equity claims based upon, securities or cash, by the delivery of securities or the making of payments to or for the account of such customer (subject to the provisions of subsection (d) and section 78fff–3(a) of this title) insofar as such obligations are ascertainable from the books and records of the debtor or are otherwise established to the satisfaction of the trustee. For purposes of distributing securities to customers, all securities shall be valued as of the close of business on the filing date. For purposes of this subsection, the court shall, among other things—
Any payment or delivery of property pursuant to this subsection may be conditioned upon the trustee requiring claimants to execute, in a form to be determined by the trustee, appropriate receipts, supporting affidavits, releases, and assignments, but shall be without prejudice to any right of a claimant to file formal proof of claim within the period specified in subsection (a)(3) for any balance of securities or cash to which such claimant considers himself entitled.
The trustee shall, to the extent that securities can be purchased in a fair and orderly market, purchase securities as necessary for the delivery of securities to customers in satisfaction of their claims for net equities based on securities under section 78fff–1(b)(1) of this title and for the transfer of customer accounts under subsection (f), in order to restore the accounts of such customers as of the filing date. To the extent consistent with subsection (c), customer property and moneys advanced by SIPC may be used by the trustee to pay for securities so purchased. Moneys advanced by SIPC for each account of a separate customer may not be used to purchase securities to the extent that the aggregate value of such securities on the filing date exceeded the amount permitted to be advanced by SIPC under the provisions of section 78fff–3(a) of this title.
Neither a registered clearing agency which by its rules has an established procedure for the closeout of open contracts between an insolvent broker or dealer and its participants, nor its participants to the extent such participants' claims are or may be processed within the registered clearing agency, shall be entitled to receive SIPC funds in payment of any losses on such contracts, except as SIPC may otherwise provide by rule. If such registered clearing agency or its participants sustain a net loss on the closeout of such contracts with the debtor, they shall have the right to participate in the general estate as unsecured creditors to the extent of such loss. Any funds or other property owed to the debtor, after the closeout of such contracts, shall be promptly paid to the trustee. Rules adopted by SIPC under this paragraph shall provide that in no case may a registered clearing agency or its participants, to the extent such participants' claims are or may be processed within the registered clearing agency, be entitled to receive funds advanced by SIPC in an amount greater, in the aggregate, than could be received by the participants if such participants proceeded individually under paragraph (1) and (2).
For purposes of this subsection, the term "customer" does not include any person who—
(1) waive or modify the need to file a written statement of claim pursuant to subsection (a)(2); and
1978—Subsecs. (a)(1), (c)(3). Pub. L. 95–598 substituted "title 11" for "the Bankruptcy Act".
For purposes of this section, the term "standard maximum cash advance amount" means $250,000, as such amount may be adjusted after December 31, 2010, as provided under subsection (e).
This chapter, referred to in subsec. (a), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
2010—Subsec. (a)(1). Pub. L. 111–203, §983(a), inserted "or options on commodity futures contracts" after "claim for securities".
Pub. L. 111–203, §929H(a)(1), substituted "the standard maximum cash advance amount for each such customer, as determined in accordance with subsection (d)" for "$100,000 for each such customer".
1980—Subsec. (a). Pub. L. 96–433, §1(1), substituted in opening par. "$500,000" for "$100,000".
Subsec. (a)(1). Pub. L. 96–433, §1(2), substituted "$100,000" for "$40,000".
If, at any time after the institution of a direct payment procedure with respect to a member, SIPC determines, in its discretion, that continuation of such direct payment procedure is not appropriate, SIPC may cease such direct payment procedure and, upon so doing, may seek a protective decree pursuant to section 78eee of this title. To the extent payments of cash, distributions of securities, or determinations with respect to the validity of a customer's claim are made under this section, such payments, distributions, and determinations shall be recognized and given full effect in the event of any subsequent liquidation proceeding. Any action brought under subsection (e) and pending at the time of the appointment of a trustee under section 78eee(b)(3) of this title shall be permanently stayed by the court at the time of such appointment, and the court shall enter an order directing the transfer or removal to it of such suit. Upon such removal or transfer the complaint in such action shall constitute the plaintiff's claim in the liquidation proceeding, if appropriate, and shall be deemed received by the trustee on the date of his appointment regardless of the date of actual transfer or removal of such action.
1978—Subsec. (e). Pub. L. 95–598, §308(n)(3), which directed striking out ", without regard to the citizenship of the parties or the amount in the controversy", was executed by striking out ", without regard to the citizenship of the parties or the amount in controversy" after "adjudication of such claim" to reflect the probable intent of Congress.
Pub. L. 95–598, §308(n)(1), (2), substituted "Bankruptcy Courts" for "District Courts" in heading and "courts of the United States having jurisdiction over cases under title 11" for "district courts of the United States" in text.
This chapter, referred to in subsecs. (b) and (c), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
1978—Subsec. (a). Pub. L. 95–283 substituted "pursuant to section 78ccc(e)(3) and section 78iii(f) of this title" for "or regulations pursuant to section 78ccc(e) and 78iii(f) of this title".
This chapter, referred to in subsec. (f), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
1978—Subsec. (a). Pub. L. 95–283, §12(a), in heading substituted "Collection" for "Collecting", and in text inserted provisions relating to designation of a self-regulatory organization other than the examining authority to act as collection agent and provisions relating to designation of a registered clearing agency as collection agent, and substituted provisions relating to remittances by the collection agent to SIPC, for provisions relating to remittances by an examining authority to SIPC.
2010—Subsec. (c)(1). Pub. L. 111–203, §929V(b)(1), substituted "$250,000" for "$50,000" in concluding provisions.
Subsec. (c)(2). Pub. L. 111–203, §929V(b)(2), substituted "$250,000" for "$50,000".
1978—Subsec. (a). Pub. L. 95–283, §13(a), inserted "and penalty" after "interest", and substituted "it" for "he" wherever appearing.
Subsec. (b). Pub. L. 95–283, §13(b), in heading inserted "or initiation of direct payment procedure" after "trustee", and in text inserted references to initiation of direct payment procedure in two places.
Subsec. (c). Pub. L. 95–283, §13(c), in heading substituted "Concealment of assets; false statements or claims" for "Embezzlement, etc., of assets of SIPC", added par. (1), and designated existing provisions as par. (2) and, as so designated, inserted references to direct or indirect acts, and provisions covering defrauding or attempts to defraud SIPC or a trustee, and substituted provisions covering activities constituting fraudulent, or with intent to defeat this chapter, abstracts or conversions, for provisions covering activities constituting unlawfully abstracting or unlawfully and willfully converting moneys, etc.
This chapter, referred to in subsecs. (a) to (f), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
1986—Subsec. (e). Pub. L. 99–514 substituted "Internal Revenue Code of 1986" for "Internal Revenue Code of 1954" wherever appearing, which for purposes of codification was translated as "title 26" thus requiring no change in text.
Subsec. (c). Pub. L. 95–283, §14(a), (c), redesignated subsec. (d) as (c) and inserted ", officers, or employees" after "Directors" in heading and text. Former subsec. (c) redesignated (b).
The term "customer" includes—
The term "customer" does not include any person, to the extent that—
The term "customer property" means cash and securities (except customer name securities delivered to the customer) at any time received, acquired, or held by or for the account of a debtor from or for the securities accounts of a customer, and the proceeds of any such property transferred by the debtor, including property unlawfully converted. The term "customer property" includes—
The term "debtor" means a member of SIPC with respect to whom an application for a protective decree has been filed under section 78eee(a)(3) of this title or a direct payment procedure has been instituted under section 78fff–4(b) of this title.
The term "filing date" means the date on which an application for a protective decree is filed under section 78eee(a)(3) of this title, except that—
(C) if the debtor is the subject of a direct payment procedure or was the subject of a direct payment procedure discontinued by SIPC pursuant to section 78fff–4(f) of this title, the term "filing date" means the date on which notice of such direct payment procedure was published under section 78fff–4(b) of this title.
The term "gross revenues from the securities business" means the sum of (but without duplication)—
The term "net equity" means the dollar amount of the account or accounts of a customer, to be determined by—
The term "persons registered as brokers or dealers" includes any person who is a member of a national securities exchange other than a government securities broker or government securities dealer registered under section 78o–5(a)(1)(A) of this title.
(Pub. L. 91–598, §16, formerly §12, Dec. 30, 1970, 84 Stat. 1656; renumbered §16 and amended Pub. L. 95–283, §§9, 15, May 21, 1978, 92 Stat. 260, 271; Pub. L. 95–598, title III, §308(o), Nov. 6, 1978, 92 Stat. 2676; Pub. L. 97–303, §7, Oct. 13, 1982, 96 Stat. 1410; Pub. L. 100–181, title VIII, §802, Dec. 4, 1987, 101 Stat. 1265; Pub. L. 106–554, §1(a)(5) [title II, §203(d)(1)], Dec. 21, 2000, 114 Stat. 2763, 2763A-424; Pub. L. 111–203, title IX, §983(b), July 21, 2010, 124 Stat. 1931.)
This chapter, referred to in provision preceding par. (1), and in pars. (10) and (13), was in the original "this Act", meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classification of this Act to the Code, see Tables.
2010—Par. (2). Pub. L. 111–203, §983(b)(1), added par. (2) and struck out former par. (2) which defined "customer".
Par. (9). Pub. L. 111–203, §983(b)(3), in concluding provisions, inserted "includes revenues earned by a broker or dealer in connection with a transaction in the portfolio margining account of a customer carried as securities accounts pursuant to a portfolio margining program approved by the Commission. Such term" before "does not include".
Par. (11). Pub. L. 111–203, §983(b)(4)(B), in concluding provisions, substituted "A claim for a commodity futures contract received, acquired, or held in a portfolio margining account pursuant to a portfolio margining program approved by the Commission or a claim for a security futures contract, shall be deemed to be a claim with respect to such contract as of the filing date, and such claim shall be treated as a claim for cash. In determining" for "In determining".
Par. (11)(A). Pub. L. 111–203, §983(b)(4)(A), substituted "by sale or purchase on the filing date—" for "by sale or purchase on the filing date, all securities positions of such customer (other than customer name securities reclaimed by such customer); minus" and added cls. (i) and (ii).
2000—Par. (14). Pub. L. 106–554 inserted "or any security future as that term is defined in section 78c(a)(55)(A) of this title," after "certificate of deposit for a security,".
1987—Par. (12). Pub. L. 100–181 inserted "other than a government securities broker or government securities dealer registered under section 78o–5(a)(1)(A) of this title".
1982—Par. (14). Pub. L. 97–303 inserted "any put, call, straddle, option, or privilege on any security, or group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency," after "the Securities Act of 1933 [15 U.S.C.A. §77a et seq.])," and substituted "Except as specifically provided above, the term 'security' does not include" for "The term 'security' does not include".
1978—Par. (1). Pub. L. 95–598, §308(o)(1), (3), struck out par. (1) definition of "Bankruptcy Act" and redesignated par. (2) as (1).
Par. (7). Pub. L. 95–598, §308(o)(2), (3), redesignated par. (8) as (7) and substituted in subpar. (A) "if a petition under title 11 concerning the debtor was filed before such date" for "if a petition was filed before such date by or against the debtor under the Bankruptcy Act, or under chapter X or XI of such Act, as now in effect or as amended from time to time". Former par. (7) redesignated (6).
Pub. L. 95–283 in introductory text inserted requirement for applicability of terms to a liquidation proceeding involving the Bankruptcy Act, in par. (1) heading substituted "Bankruptcy Act" for "Self-regulatory organization", and in text substituted provisions defining such terms, in par. (2) heading substituted "Commission" for "Financial responsibility rules", and in text substituted provisions defining such terms, in par. (3) heading substituted "Customer" for "Examining authority", and in text substituted provisions defining such terms, and added pars. (4) to (15).