Series 27: Commingling Of Hypothecated Securities

Commingling of Hypothecated Securities

Broker-dealers may not commingle hypothecated securities of any customer with the securities of any other customer without the customer’s prior written consent. This consent is given when the customer signs the hypothecation agreement. Nor may they commingle hypothecated customer securities with the securities of the broker-dealer. Finally, they may not hypothecate customer securities that will subject them to a hypothecation or pledge that exceeds their customers’ liabilities or aggregate indebtedness to the broker-dealer. The c