Pershing, now part of the Bank of New York (BNY) Securities Group, is one of 14 firms that provide excess securities account protection through the Customer Asset Protection Company (CAPCO), a licensed New York insurance company launched this week. Through CAPCO, member firms extend account protection to institutional and individual brokerage accounts that they maintain.
Pershing says that, by participating in CAPCO, it can provide clients with additional brokerage account protection, similar to the excess Securities Investor Protection Corporation (SIPC) insurance that the domestic insurance market announced it would discontinue in early 2004.
Through this coverage, each client account held at a participating CAPCO member firm receives excess SIPC protection up to its net equity for securities and cash held in the account at the brokerage firm. The coverage will protect client accounts maintained by Pershing in the US and follows the underlying terms of SIPC protection. In addition, the insurer will provide a form of this extended coverage for the clients of participating broker-dealers in the UK, which will enable Pershing to extend this excess coverage to client accounts maintained by its London-based business.
“Pershing is committed to providing its customers and their clients with the highest level of account protection available in our industry,” says Brian T. Shea, chief operating officer of Pershing. “We are pleased to be among the select group of CAPCO founding members and look forward to participating with industry leaders to further strengthen individual investor confidence in the financial markets by delivering this excess account protection.”