What if the brokerage firm holding my cash or securities goes bankrupt?
The majority of brokerage firms are members of the Canadian Investor Protection Fund (CIPF). CIPF is a trust established by the sponsoring SROs (the IDA and Stock Exchanges) to protect customers in the event of the insolvency of a Member. Member firms pay into this fund. It should be noted that Mutual Fund companies are not CIPF members. If your brokerage firm goes bankrupt and is a member of CIPF and your securities are registered in “street” name (ie. in the name of your broker), then your securities and money are protected for up to $1,000,000. CIPF does not cover customers’ losses that result from other causes such as changing market values of securities, unsuitable investments or the default of an issuer of securities. Customers have 180 days to file a claim with CIPF. If you want to know whether your brokerage firm is a member of CIPF, you should ask your broker, or call CIPF at (416) 866-8366. If your securities are registered in your own name customers can deal directly with is
