{"data":{"id":"us-ky/krs-355.8-503","jurisdiction":"us-ky","citation":"KRS 355.8-503","heading":"Property interest of entitlement holder in financial asset held by","body":"securities intermediary.\n(1) To the extent necessary for a securities intermediary to satisfy all security\nentitlements with respect to a particular financial asset, all interests in  that financial\nasset held by the securities intermediary are held by the securities intermediary for\nthe entitlement holders, are not property of the securities intermediary, and are not\nsubject to claims of creditors of the securities intermediary, excep t as otherwise\nprovided in KRS 355.8-511.\n(2) An entitlement holder's property interest with respect to a particular financial asset\nunder subsection (1) of this section is a pro rata property interest in all interests in\nthat financial asset held by the s ecurities intermediary, without regard to the time\nthe entitlement holder acquired the security entitlement or the time the securities\nintermediary acquired the interest in that financial asset.\n(3) An entitlement holder's property interest with respect to  a particular financial asset\nunder subsection (1) of this section may be enforced against the securities\nintermediary only by exercise of the entitlement holder's rights under KRS 355.8 -\n505 to 355.8-508.\n(4) An entitlement holder's property interest with respect to a particular financial asset\nunder subsection (1) of this section may be enforced against a purchaser of the\nfinancial asset or interest therein only if:\n(a) Insolvency proceedings have been initiated by or against the securities\nintermediary;\n(b) The securities intermediary does not have sufficient interests in the financial\nasset to satisfy the security entitlements of all of its entitlement holders to that\nfinancial asset;\n(c) The securities intermediary violated its obligations under KRS 355. 8-504 by\ntransferring the financial asset or interest therein to the purchaser; and\n(d) The purchaser is not protected under subsection (5) of this section.\nThe trustee or other liquidator, acting on behalf of all entitlement holders having\nsecurity entit lements with respect to a particular financial asset, may recover the\nfinancial asset, or interest therein, from the purchaser. If the trustee or other\nliquidator elects not to pursue that right, an entitlement holder whose security\nentitlement remains uns atisfied has the right to recover its interest in the financial\nasset from the purchaser.\n(5) An action based on the entitlement holder's property interest with respect to a\nparticular financial asset under subsection (1) of this section, whether framed in\nconversion, replevin, constructive trust, equitable lien, or other theory, may not be\nasserted against any purchaser of a financial asset or interest therein who gives\nvalue, obtains control, and does not act in collusion with the securities intermediary\nin violating the securities intermediary's obligations under KRS 355.8-504.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=33719","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:58:47Z","sha256":"ec44fd5fa9fc7f4d7bd293cccd066ecf445289f4bfb223df3f86f83b03f4f4ff","source_id":"us-ky","stale":false,"prev":"us-ky/krs-355.8-502","next":"us-ky/krs-355.8-504"},"notice":"GroundRules: Original legal text. Not legal advice."}