WEBVTT

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We are the Securities Investor Protection Corporation,

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also known as SIPC.

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SIPC is a non-profit corporation

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created by Congress some 50 years ago.

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It is an important part of the overall

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system of investor protection in the United States.

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We work to restore investors’

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cash and securities when a brokerage firm fails.

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SIPC protects the customers

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of all registered brokerage firms in the United States.  

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To help explain, let’s take each part of our name:

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Securities. Securities are investments,

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such as stocks and bonds.

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When you buy stocks or bonds,

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you usually don’t take them home.

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Instead, they are held in an account at a brokerage firm.

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The broker can trade them on your behalf. 

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Investor. That’s you, the brokerage customer,

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who has bought stocks or bonds

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and has asked a brokerage firm to hold them.

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You may also have some cash in your account

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at the brokerage firm because of stock sales

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or for future purchases.

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Protection. That’s us.

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Our job is to recover missing cash or securities

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if your brokerage firm goes bankrupt

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or is in financial trouble.

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Importantly, we can only protect you

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if the brokerage firm is a member of SIPC.

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To find out if your brokerage firm is a member,

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click on the link on our homepage with this icon. 

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Corporation. We are a membership corporation,

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created by federal law, which means brokerage firms

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that are SIPC members must abide by certain rules.

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This gives their customers peace of mind.

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Investors know that if their SIPC-member brokerage firm

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fails and if securities or cash are missing,

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SIPC will work to recover them.

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And if SIPC cannot obtain customer assets,

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we will work to replace your assets.

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It is rare that a brokerage firm fails

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or has to close suddenly. But if it does,

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SIPC helps close the firm through a process called liquidation.

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This means we work to liquidate the failed brokerage firm’s business

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and establish a claims process to get you back your property.

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During this process, SIPC works to return your securities

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and cash as quickly as possible.

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In some cases, we may transfer your assets to another

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brokerage firm quickly after your firm has failed.

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There are some limits to what SIPC can protect.

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SIPC protects your account up to $500,000 in securities.

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This includes a $250,000 limit for cash you may have had in the account.

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If your account was worth more than $500,000

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on the day liquidation began, and customer assets

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are recovered during the liquidation

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which is often the case

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you share in that recovery up to the value of your account.

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It is important to know that we can’t protect investors

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from declines in the stock market,

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or from bad advice on investments by your broker.

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So, for your protection,

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make sure your brokerage firm is a SIPC member.

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Look for the SIPC logo,

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and check on our website to confirm your brokerage firm’s membership.