Account Protection

At E.K.Riley Investments, safeguarding your assets is one of our highest priorities. That’s why, in addition to relying on the financial integrity, strength and stability of the firm itself, we also offer account protection through the Securities Investor Protection Corporation (SIPC) and various syndicates of Lloyd’s of London for protection beyond SIPC limitations. Here are the details:

SIPC Coverage

Securities Investor Protection Corporation (SIPC), established as a nonprofit entity by Congress in 1970, protects client assets in the event of a member firm’s bankruptcy or insolvency. E.K. Riley Investments is a member of SIPC, which protects securities customers of its members up to $500,000 (including $100,000 for claims for cash). An explanatory brochure is available upon request or at www.sipc.org or by calling 202-371-8300.

SIPC is not the FDIC.

The Securities Investor Protection Corporation does not offer to investors the same blanket protection that the Federal Deposit Insurance corporation provides to bank depositors. Account protection applies when a SIPC-member firm fails financially and is unable to meet obligations to securities clients, but it does not protect against market fluctuations.

Excess SIPC Coverage

In the vast majority of cases, SIPC is likely to meet 100% of the claims of individual investors. However, to account for clients whose losses may be such that a deficiency still exists after they have received the full SIPC entitlement (subject to any sub-limit for claims for cash), First Clearing has purchased excess SIPC coverage through various syndicates of Lloyd’s, a London-based firm. Excess SIPC is fully protected by the Lloyd’s trust funds and Lloyd’s Central Fund. The additional protection works as follows: For clients who have received the full SIPC payout limit, First Clearing’s policy with Lloyd’s provides additional coverage above the SIPC limit for any missing securities and cash in client brokerage accounts up to a firm aggregate limit of $1 billion (including up to $1.9 million for cash per client; $1 billion aggregate limit relates to all accounts carried by First Clearing, not just E.K.Riley Investments). In other words, the aggregate amount of all client losses covered under this policy are subject to a limit of $1 billion, with each client covered up to $1.9 million for cash. Please note that Money Market Funds are treated as securities and would be considered for coverage under SIPC and the additional coverage through Lloyd’s (subject to the firm aggregate limit of $1 billion, but not subject to the $1.9 million in cash limit per client). Neither SIPC nor the additional insurance provided through Lloyd’s, in particular the $1.9 million in cash, covers balances in the Bank Deposit Sweep Program. Balances in the Bank Deposit Sweep Program are instead covered by the FDIC up to the specified limits of $250,000. Since its beginnings in the 17th century, Lloyd’s of London has been a world leader in insurance markets, providing its service to businesses in a broad range of sectors. Currently, Standard and Poor’s and Fitch have rated Lloyd’s credit as A+ (Strong) Stable Outlook and A.M. Best has rated Lloyd’s a credit rating of "A(Excellent) Stable Outlook." For more information on Lloyd’s, please visit www.lloyds.com Certain types of assets that are not protected under SIPA (Securities Investor Protection Act) are also not covered by the additional protection through Lloyd’s. Among the investments that are ineligible for SIPA protection are commodity futures contracts, fixed annuity contracts, currency, and precious metals, as well as investment contracts (such as limited partnerships) that are not registered with the U.S. Securities and Exchange Commission (SEC) under the Securities Act of 1933.

Summary of Client Asset Protection

Types of Assets Covered

• Cash (Free Credit Balance)
• Most Stocks (Common and Preferred Stock Options)
• Bonds (Corporate, Municipals)
• U.S. Treasury/Government Agency Securities (Bills, Notes, Bonds, Zeros)
• Asset/Mortgage-Backed Securities

Types of Assets Not Covered

• Foreign Exchange
• Precious Metals and Other Commodities
• Futures
• Fixed Annuities and Life Insurance
• Swaps
• Bank Deposit Sweep (Covered by FDIC)
• CDs