N.Y. Uniform Commercial Code 9-206 – Security Interest Arising in Purchase or Delivery of Financial Asset
Section 9–206. Security Interest Arising in Purchase or Delivery of
Terms Used In N.Y. Uniform Commercial Code 9-206
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
Financial Asset.
(a) Security interest when person buys through securities intermediary. A security interest in favor of a securities intermediary attaches to a person's security entitlement if:
(1) the person buys a financial asset through the securities
intermediary in a transaction in which the person is
obligated to pay the purchase price to the securities
intermediary at the time of the purchase; and
(2) the securities intermediary credits the financial asset to
the buyer's securities account before the buyer pays the
securities intermediary.
(b) Security interest secures obligation to pay for financial asset. The security interest described in subsection (a) secures the person's obligation to pay for the financial asset.
(c) Security interest in payment against delivery transaction. A security interest in favor of a person that delivers a certificated security or other financial asset represented by a writing attaches to the security or other financial asset if:
(1) the security or other financial asset:
(A) in the ordinary course of business is transferred by
delivery with any necessary indorsement or assignment;
and
(B) is delivered under an agreement between persons in the
business of dealing with such securities or financial
assets; and
(2) the agreement calls for delivery against payment.
(d) Security interest secures obligation to pay for delivery. The security interest described in subsection (c) secures the obligation to make payment for the delivery.