§24 Customer Property with Respect to Commodity Broker Debtors; Definitions

Summary

The Commission can make rules about how to treat customer property when a commodity broker files for bankruptcy under chapter 7 of title 11. It can say which cash, securities, other property, or commodity contracts count as customer or member property, which items must be tied to a specific customer, how the broker’s business must be run or closed after the bankruptcy filing (including how to pay and allocate margin for contracts not tied to a customer), who may receive customer property under section 766 of title 11, and how to figure a customer’s net equity. The words commodity broker, commodity contract, customer, customer property, member property, net equity, and security mean the same as in subchapter IV of chapter 7 of title 11. The Commission must also treat securities in a portfolio margining account carried as a futures account as customer property, and the account owners as customers for those subchapter IV rules.