A broker/dealer firm has become insolvent. SIPC liquidation procedures have begun. Jill and Jack are married and each of them have individual accounts along with a joint account with each other at the firm. The following are their account balances: Jill's individual account has $275,000 in fully-paid securities Jack's individual account has $265,000 in fully-paid securities Jill and Jack's joint account has $475,000 in fully-paid securities What would SIPC cover in relation to these accounts?

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Higgins

Business

23 September, 23:43

A broker/dealer firm has become insolvent. SIPC liquidation procedures have begun. Jill and Jack are married and each of them have individual accounts along with a joint account with each other at the firm. The following are their account balances: Jill's individual account has $275,000 in fully-paid securities Jack's individual account has $265,000 in fully-paid securities Jill and Jack's joint account has $475,000 in fully-paid securities What would SIPC cover in relation to these accounts?

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Pranav Delacruz · Answer 1

Jill's : Up to $500,000

Jack's : Up to $500,000

Joint account : Up to $500,000

Explanation:

SIPC is created to protect clients of brokerage firm that goes insolvent.

It provides up to $500,000 per capacity for customers that lost investment in securities in the institution while up to $250,000 coverage is meant for cash in the account that is not invested in securities.

Customer with different accounts are assessed by separate capacity. Different accounts held in the same capacity are merged for the sake of compensation.

Concerning couples with different accounts and a joint account. each of the couple are treated as different capacities while the joint account is also treated as another capacity