Account
Account Protection

Safe Investments

  Your stocks, bonds, mutual funds, options, and certificates of deposit are all protected and at no additional cost to you.

  Q.   What is my account protection?
  A.

   Customer securities accounts carried by Penson Financial Services are protected by the Securities Investor Protection Corporation (SIPC), up to $500,000 (including up to $100,000 for cash claims). In addition, our clearing firm, Penson Financial (Penson) has purchased from underwriters at Lloyd's of London further protection of securities and cash with an aggregate limit of $200 million which might not be returned in a SIPC liquidation, and providing that the combined return from Trustee distributions, SIPC and London to any customer does not exceed $35 million including a London cash sub-limit of $900,000.

  Q.   What kinds of assets are covered?
  A.

   Your stocks, bonds, mutual funds, notes, debentures, warrants, rights, options, money market funds and certificates of deposit are protected in the event of losses resulting from a brokerage firm's insolvency or liquidation. However, it is important to note that the account protection does not protect against losses due to market fluctuations. SIPC and the supplemental policy do not cover commodity contracts and options on futures.

  Q.   What is the Securities Investor Protection Corporation?
  A.

   SIPC is a non-profit member organization of broker-dealers created in 1970 by an act of Congress. It protects customers of those broker-dealer members that for some reason can't meet their financial obligations to their customers.
  Q.   Where does SIPC get the funds to protect me?
  A.

   SIPC can draw on approximately US$790 million of member contributions and interest earned from U.S. Government Securities. It also has a US$1 billion line of credit with a bank consortium. And if necessary, SIPC can also borrow up to US$1 billion from the U.S. Treasury.
  Q.   Is my money market investment considered cash and therefore covered up to US$100,000?
  A.

   Money market funds are in fact investment companies that invest in short term securities. While these investments are almost as liquid as cash, they considered a security - so your money market investments are protected up to US$10 million in each separately registered account.
For more information on Account Protection, call our Client Support at 1.888.353.6676 or 1.415.901.0311.