Court Backs Agency’s Right to Sue Brokers:...
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From Times Staff and Wire Reports
Court Backs Agency’s Right to Sue Brokers: A federal appeals court ruled that the Securities Investor Protection Corp., an agency created by Congress to protect securities investors, can sue fraudulent brokers for racketeering and seek triple damages. The 9th U.S. Circuit Court said SIPC can use the powerful Racketeer Influenced and Corrupt Organizations Act in civil suits against brokers. SIPC reimburses customers of failed brokers and can appoint a receiver to sell or liquidate an insolvent brokerage that has violated the law.
