Judge Rules 'Soft-Dollar' Claims Aren't Protected By SIPA

Law360, New York (July 10, 2012, 10:56 PM EDT) -- A New York bankruptcy judge agreed with Lehman Brothers Inc.’s Securities Investor Protection Act trustee Tuesday in finding that so-called soft-dollar claims, which involve credits that are redeemed for certain services provided by a broker-dealer, cannot be protected like customers' claims under SIPA.

U.S. District Judge James M. Peck said such soft-dollar credits are similar to frequent-flier miles in that they can be used only to pay for certain research services provided by the broker dealer and not spent like regular cash, siding with Lehman’s SIPA...
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