N.Y. UCC Law § 8-504

Section 8--504. Duty of Securities Intermediary to Maintain Financial\n Asset.\n (a) A securities intermediary shall promptly obtain and thereafter\nmaintain a financial asset in a quantity corresponding to the aggregate\nof all security entitlements it has established in favor of its\nentitlement holders with respect to that financial asset. The securities\nintermediary may maintain those financial assets directly or through one\nor more other securities intermediaries.\n (b) Except to the extent otherwise agreed by its entitlement holder, a\nsecurities intermediary may not grant any security interests in a\nfinancial asset it is obligated to maintain pursuant to subsection (a).\n (c) A securities intermediary satisfies the duty in subsection (a) if:\n (1) the securities intermediary acts with respect to the duty as\n agreed upon by the entitlement holder and the securities\n intermediary; or\n (2) in the absence of agreement, the securities intermediary\n exercises due care in accordance with reasonable commercial\n standards to obtain and maintain the financial asset.\n (d) This section does not apply to a clearing corporation that is\nitself the obligor of an option or similar obligation to which its\nentitlement holders have security entitlements.\n