How can I be sure I am dealing with a SIPC member? Why is that
important?
Look for this language:
MEMBER SECURITIES INVESTOR PROTECTION CORPORATION
Those words – or “Member SIPC” -- appear in all signs and ads
of SIPC members. If you have a question as to whether or not
a particular firm is a member of SIPC, you may call the SIPC
Membership Department at 202/371-8300 or visit us on the Web
at www.sipc.org.
Why is the issue of SIPC membership relevant to you? SIPC protects
customers of broker- dealers as long as the broker-dealer is
a SIPC member. However, if a SIPC member's registration with
the U.S. Securities and Exchange Commission is terminated, the
broker-dealer's SIPC membership is also automatically terminated.
SIPC loses its power to protect customers of former SIPC members
180 days after the broker-dealer ceases to be a member of SIPC.
Normally, the SEC will not permit the termination of the registration
and SIPC membership of a broker-dealer if the firm owes securities
or cash to customers. However, a SIPC membership may be terminated
if the Commission is unaware the firm owes securities or cash
to customers.
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