What should I be vigilant about before a problem strikes?
Some SIPC members have affiliated or related companies or persons
that conduct financial or investment businesses but are not
members of SIPC. Some of these affiliates have names which are
similar to the name of the SIPC member, or which operate from
the same offices or with the same employees. Be sure you receive
written confirmation of each securities transaction in your
securities account with the SIPC member, and that each confirmation
statement and each statement of account is issued by the SIPC
member and not by a non-SIPC affiliate. Deposits for credit
to your securities account, by check or otherwise, should not
be made payable to your account executive, registered representative,
or to any other individual, but generally only to your SIPC
member broker-dealer or, if your account is carried at another
SIPC member who provides clearing services for your SIPC member
broker-dealer, then to that other SIPC member. If your check
or deposit is payable to other than a SIPC member broker-dealer
(such as to the issuer of the securities you are purchasing
or to a bank escrow agent), you should take steps to insure
that your funds are properly applied.
You should be vigilant to assure that you receive your periodic
statements on a timely basis. The failure to provide statements
may indicate the broker-dealer has gone out of business. If
you do not receive your statement when due and cannot get a
satisfactory explanation, or if for any other reason you believe
your broker-dealer may have ceased doing business, you should
promptly contact the nearest office of the Commission. If your
broker-dealer ceases to be a SIPC member while still owing cash
and securities to you, you should notify the Commission well
within the 180-day period.
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