L.M. Kohn & Company has a contractual agreement with RBC Correspondent Services (RBC CS) to serve as our clearing firm. This fully disclosed agreement states the responsibilities of each party. Prior to the agreement becoming effective, RBC CS is responsible for making all disclosures to our firm’s designated examining authority as required by NYSE Rule 382. Each client of our firm is notified of the relationship via a disclosure letter. The disclosure letter details the responsibilities that our firm (the introducing broker-dealer) and RBC CS (the clearing firm) have to the client. Although client assets are held by RBC Capital Markets Corporation, neither RBC Capital Markets Corporation nor RBC CS has responsibility for the financial condition or performance of our firm or our Financial Consultants. Our clearing firm, RBC Correspondent Services, is a division of RBC Capital Markets Corporation. RBC Capital Markets Corporation is a member of the Securities Investor Protection Corporation (SIPC). SIPC is a nonprofit membership corporation funded by its member security broker-dealers. SIPC protects the securities clients of its members in the event of the failure of a member firm. SIPC reimburses clients the cash value of their securities up to $500,000 per client. Any cash in a client’s account would be reimbursed by SIPC up to $100,000 (reducing the $500,000 above). RBC Capital Markets Corporation has purchased an additional policy that offers coverage in excess of the protection provided by SIPC. This coverage covers additional securities and cash protection up to $99.5 million per client, of which $900,000 may be in cash. A $400 million aggregate limit applies to this additional coverage. RBC Capital Markets Corporation also offers protection if a client’s securities are missing because of theft by an outsider, computer fraud or theft by an employee for personal gain. In such cases, the firm’s CAN$310 million Financial Institution Bond coverage would cover the client’s losses, subject to that policy’s terms, conditions and limits. Note: Neither SIPC protection, nor protection in excess of that offered by SIPC, covers a decline in the value of a client’s assets due to market loss. Additional information is available upon request or at www.sipc.org.
