§ 8116 Securities Intermediary Purchaser Rights

Commercial Code·California

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Key Takeaways

•If a company holds money or stocks for you, they own it like they bought it.
•If one company gives your stocks to another company, the new company owns it if they hold it for you.
•This is about who really owns stocks or money when companies handle it for people.

Example

You buy stocks through a broker like Robinhood.

Robinhood holds your stocks for you, so they legally own them like they bought them, but they must give them back to you when you ask.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source

View on CA.gov

§ 8116 Securities Intermediary Purchaser Rights

A securities intermediary that receives a financial asset and establishes a security entitlement to the financial asset in favor of an entitlement holder is a purchaser for value of the financial asset. A securities intermediary that acquires a security entitlement to a financial asset from another securities intermediary acquires the security entitlement for value if the securities intermediary acquiring the security entitlement establishes a security entitlement to the financial asset in favor of an entitlement holder. (Added by Stats. 1996, Ch. 497, Sec. 9. Effective January 1, 1997.)

Last verified: January 23, 2026

Key Terms

securities intermediary financial asset security entitlement entitlement holder purchaser for value

References

Official text at leginfo.legislature.ca.gov
California Legislature. Commercial Code. Section 8116.

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Key Takeaways

Example

Key Terms

Related Statutes

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