One of my clients has a securities account at a national stock brokerage company with about $300,000 of liquid, marketable securities. The client borrowed about $230,000 from the brokerage company “on margin” so that the loan is secured by the stocks in the account. The client has a judgment against him for over $1,000,000.
The client believes that his stock account is protected from his judgment creditor by virtue of the margin loan security. He believes that the stock account could not be subject to garnishment because the margin loan agreement gives the lender/broker a first security interest in the entire account.
Last updated on May 22, 2020