8.8A-511 - A-511. Priority among security interests and entitlement holders. - Virginia Statutes

§ 8.8A-511. Priority among security interests and entitlement holders.

(a) Except as otherwise provided in subsections (b) and (c), if a securitiesintermediary does not have sufficient interests in a particular financialasset to satisfy both its obligations to entitlement holders who havesecurity entitlements to that financial asset and its obligation to acreditor of the securities intermediary who has a security interest in thatfinancial asset, the claims of entitlement holders, other than the creditor,have priority over the claim of the creditor.

(b) A claim of a creditor of a securities intermediary who has a securityinterest in a financial asset held by a securities intermediary has priorityover claims of the securities intermediary's entitlement holders who havesecurity entitlements with respect to that financial asset if the creditorhas control over the financial asset.

(c) If a clearing corporation does not have sufficient financial assets tosatisfy both its obligations to entitlement holders who have securityentitlements with respect to a financial asset and its obligation to acreditor of the clearing corporation who has a security interest in thatfinancial asset, the claim of the creditor has priority over the claims ofentitlement holders.

(1996, c. 216.)