CAPCO is an
insurance company licensed by the state of Vermont. CAPCO providesprotection only for institutional
and individual clients' securities accounts of Lehman Brothers Inc. and Lehman Brothers International (Europe).
This Excess SIPC protection is excess of the
protection provided by the Securities Investor
Protection Act ("SIPA"), which is
administered by the Securities Investor Protection
broker/dealer referred to as the "Firm"
in the CAPCO Excess SIPC Surety Bond issued
to that Firm (the "Bond") may also
be referred to as "Insured" under
Bond. But it is the "Customers" of
the Firm (as "Customer" is defined
in the Bond), rather than the Firm itself, who
are the beneficiaries of CAPCO's payment obligations
under the Bond. Because insolvency proceeding were commenced prior to expiration of the Bonds with regard only to Lehman Brothers Inc.and Lehman Brothers International (Europe), only Customers of those Firms may be beneficiaries under the Bonds. The coverage of the Bond is
described in more detail in the answers below.
Because insolvency proceeding were commenced prior to expiration of the Bonds with regard only to Lehman Brothers Inc.and Lehman Brothers International (Europe), only Customers of those Firms may be beneficiaries under the Bonds. See www.sipc.org for
more information. Under the
Bond, a Customer is a client of the Firm who satisfies the
definition of "Customer" set forth
in section 78lll(2) of the SIPA.
No, all Customers
of Lehman Brothers Inc. and Lehman Brothers International (Europe) are eligible for coverage under
the Bond, subject to its terms.
protection does not apply to all losses. For
example, it does not apply to any loss that
arises directly or indirectly through fraudulent,
dishonest, or wrongful acts on the part of the
Customer, or through any such act in which the
Customer is implicated.
changes to SIPA, however, are subject to congressional
approval. If any provision of SIPA is altered
so as to affect the protection afforded by the
Bond, CAPCO has the option of accepting the
alterations, renegotiating the Bond with the
Firm, or canceling the Bond upon 90 days notice
to the Firm. See www.sipc.org
for information regarding SIPA.
to the terms and conditions generally applicable
of assets that are not protected under SIPA,
are also not covered by Excess SIPC protection.
Among the investments that are ineligible for
SIPA protection are commodity futures contracts,
currency, and precious metals, as well as investment
contracts (such as limited partnerships) and
fixed annuity contracts that are not registered
with the U.S. Securities and Exchange Commission
under the Securities Act of 1933.
No. The Customer's
assets must first be protected by SIPA in order
to be eligible for Excess SIPC protection.
Claims under the Bond may
be submitted as late as six months after the
underliying SIPC proceeding is closed.