400.8-511. Priority among security interests and entitlement holders. - Missouri Statutes

Priority among security interests and entitlement holders.

400.8-511. (a) Except as otherwise provided in subsections (b) and(c), if a securities intermediary does not have sufficient interests in aparticular financial asset to satisfy both its obligations to entitlementholders who have security entitlements to that financial asset and itsobligation to a creditor of the securities intermediary who has a securityinterest in that financial asset, the claims of entitlement holders, otherthan the creditor, have priority over the claim of the creditor.

(b) A claim of a creditor of a securities intermediary who has asecurity interest in a financial asset held by a securities intermediaryhas priority over claims of the securities intermediary's entitlementholders who have security entitlements with respect to that financial assetif the creditor has control over the financial asset.

(c) If a clearing corporation does not have sufficient financialassets to satisfy both its obligations to entitlement holders who havesecurity entitlements with respect to a financial asset and its obligationto a creditor of the clearing corporation who has a security interest inthat financial asset, the claim of the creditor has priority over theclaims of entitlement holders.

(L. 1997 S.B. 6)