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Code · U.S. Code · Title 15 - COMMERCE AND TRADE · CHAPTER 2B— SECURITIES EXCHANGES · § 78h

§ 78h. Restrictions on borrowing and lending by members, brokers, and dealers

623 words·~3 min read·/usc/title-15/section-78h

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

It shall be unlawful for any registered broker or dealer, member of a national securities exchange, or broker or dealer who transacts a business in securities through the medium of any member of a national securities exchange, directly or indirectly—
(a)In contravention of such rules and regulations as the Commission shall prescribe for the protection of investors to hypothecate or arrange for the hypothecation of any securities carried for the account of any customer under circumstances
(1)that will permit the commingling of his securities without his written consent with the securities of any other customer,
(2)that will permit such securities to be commingled with the securities of any person other than a bona fide customer, or
(3)that will permit such securities to be hypothecated, or subjected to any lien or claim of the pledgee, for a sum in excess of the aggregate indebtedness of such customers in respect of such securities.
(b)To lend or arrange for the lending of any securities carried for the account of any customer without the written consent of such customer or in contravention of such rules and regulations as the Commission shall prescribe for the protection of investors.
(June 6, 1934, ch. 404, title I, § 8, 48 Stat. 888; Aug. 23, 1935, ch. 614, § 203(a), 49 Stat. 704; Pub. L. 94–29, § 5, June 4, 1975, 89 Stat. 109; Pub. L. 98–440, title I, § 103, Oct. 3, 1984, 98 Stat. 1690; Pub. L. 103–325, title II, § 204, Sept. 23, 1994, 108 Stat. 2199; Pub. L. 104–290, title I, § 104(b), Oct. 11, 1996, 110 Stat. 3423.)
Connections22 cite this · traces to 2
20 references not yet in our index
  • June 6, 1934, ch. 404
  • 48 Stat. 888
  • Aug. 23, 1935, ch. 614, § 203(a)
  • 49 Stat. 704
  • Pub. L. 94–29, § 5
  • 89 Stat. 109
  • Pub. L. 98–440, title I, § 103
  • 98 Stat. 1690
  • Pub. L. 103–325, title II, § 204
  • 108 Stat. 2199
  • Pub. L. 104–290, title I, § 104(b)
  • 110 Stat. 3423
  • Pub. L. 104–290
  • Pub. L. 103–325
  • Pub. L. 98–440
  • Pub. L. 94–29, § 5(1)
  • Pub. L. 94–29, § 5(2)
  • Pub. L. 94–29
  • section 31(a) of Pub. L. 94–29
  • 64 Stat. 1265
Citation graph
cites case law
§ 78h
Restrictions on borrowing and lending by members, brokers, and dealers
Fed. Reg.×13
U.S.C.×4
C.F.R.×3
Stat.×2
ActJune 6, 1934, ch. 404
Stat.48 Stat. 888
ActAug. 23, 1935, ch. 614, § 203(a)
Stat.49 Stat. 704
Pub. L.Pub. L. 94–29, § 5
Cites 22 · showing 7Cited by 22 across 4 sources
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