Security Fund
/ˈsɪkjʊrɪti fʌnd/
Definitions
- (n.) A reserved fund established to secure payment of claims, obligations, or damages, often used in insolvency, insurance, or regulatory contexts.
The company maintained a security fund to cover potential claims from creditors.
- (n.) A fund required by law or regulation to assure financial responsibility and protect third parties, commonly seen in securities regulation or professional licensing.
Broker-dealers must contribute to the security fund to protect investors from losses due to fraud.
Forms
- security fund
- security funds
Related terms
See also
Commentary
Security funds are typically regulated to ensure solvency and creditor protection; drafting should specify the nature of claims secured and applicable regulatory requirements.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.