What is the SIPC? The Securities Investor Protection Corporation (SIPC) is a US non-profit organization created under the Securities Investor Protection Act of 1970 (SIPA) that provides limited insurance protection to customers of brokerage firms that are members of SIPC in the event of the firm’s failure.

What is the Purpose of SIPC?

SIPC’s purpose is to help ensure that investors are protected against the loss of their cash and securities held at a failed brokerage firm, up to a maximum limit of $500,000 per customer, including a limit of $250,000 for cash claims. SIPC does not protect against market loss or provide compensation for any decline in the value of securities. The organization’s goal is to restore customer accounts as quickly as possible and to minimize disruptions to the securities markets.

What is the History of SIPC?

The Securities Investor Protection Corporation (SIPC) was created in 1970 by an act of the US Congress. It was signed into law by President Richard Nixon in December of that year as a non-profit organization to provide limited insurance protection to customers of brokerage firms that are members of SIPC. The creation of SIPC was a response to the collapse of a number of brokerage firms in the late 1960s, which resulted in the loss of customer assets and raised concerns about the stability of the financial system.

SIPC operates under the supervision of the Securities and Exchange Commission (SEC) and is funded by assessments on its member firms. Since its creation, SIPC has been involved in a number of high-profile failures of brokerage firms, including the collapse of Bernard L. Madoff Investment Securities in 2008 and the bankruptcy of MF Global in 2011.

SIPC has helped to provide a measure of stability and protection to investors in the event of a brokerage firm’s failure and has played an important role in maintaining the confidence of the investing public in the US financial system.

How to Become a Member of SIPC?

To become a member of the Securities Investor Protection Corporation (SIPC), you must be a brokerage firm registered with the Securities and Exchange Commission (SEC) and engaged in the business of buying, selling, or holding securities for the accounts of others.

Brokerage firms must apply for SIPC membership and pay annual assessments to fund the organization’s operations. The process for becoming a SIPC member typically involves the following steps:

1. Register with the SEC: The first step in becoming a SIPC member is to register with the SEC as a brokerage firm.
2. Complete the SIPC membership application: The next step is to complete the SIPC membership application, which can be found on the organization’s website.
3. Pay annual assessments: SIPC is funded by assessments on its member firms, so you must pay annual assessments to maintain your membership in the organization.
4. Comply with SIPC rules and regulations: As a SIPC member, you must comply with the organization’s rules and regulations, including maintaining adequate levels of net capital and providing periodic financial statements to SIPC.

You can also contact the Membership Department at 202-371-8300 or send an email to form@sipc.org and request an ACH Enrollment Form.

Once you have completed these steps, your brokerage firm will be considered a member of SIPC and your customers will be eligible for the limited insurance protection provided by the organization in the event of your firm’s failure.

How to Contact SIPC?

To contact the Securities Investor Protection Corporation (SIPC), you can use the following methods:

1. Phone: You can call SIPC at (202) 371-8300.
2. Fax: You can Fax SIPC at (202) 223-1679
3. Email: You can send an email to info@sipc.org or asksipc@sipc.org
4. Mail: You can write to SIPC at the following address: Securities Investor Protection Corporation 1667 K St NW STE 1000, Washington, DC 20006
5. Website: You can visit SIPC’s official website at www.sipc.org for more information and to access online resources, including a list of frequently asked questions (FAQs) and information about the claims process.

Please note that SIPC is a non-profit organization and does not provide investment advice or recommendations. If you have a specific question or concern about your investment account, it is best to contact your brokerage firm directly.

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