How your funds are protected
Three layers of protection. SIPC covers your securities. FDIC covers your cash. SEC Rule 15c3-3 keeps everything segregated. Here is how each one works.
Three layers of protection
Layer 1: SIPC securities insurance
SIPC protects customer securities accounts if a broker-dealer fails financially. Coverage includes up to $500,000 per customer (including up to $250,000 for cash claims). This means if Axos Clearing LLC were to become insolvent, SIPC would step in to return your securities.
SIPC does not protect against market value losses. It protects against the custodian failing to return your assets.
Layer 2: FDIC multi-bank cash sweep
Uninvested cash in your brokerage account is automatically swept to a network of FDIC-insured partner banks. Each bank provides $250,000 in deposit insurance. With up to 32 banks in the sweep network, total coverage reaches up to $8,000,000 per depositor.
The sweep runs automatically. You do not need to open separate bank accounts or manage the distribution yourself.
Layer 3: SEC Rule 15c3-3 segregation
This federal rule requires Axos Clearing LLC to hold customer assets in dedicated reserve accounts completely separate from the firm's own money. The clearing firm performs this calculation every business day and backs the reserve with cash or U.S. Treasury securities.
Your shares sit in a custody account, not on our balance sheet. If FoundersXTrade shut down, your portfolio stays at Axos Clearing and can transfer to any other U.S. broker.
Zero hidden fees
Common questions
What happens to my money if FoundersXTrade goes out of business?
Your securities are held in custody by Axos Clearing LLC, not by FoundersXTrade. If FoundersXTrade ceases operations, your portfolio stays at Axos Clearing and can be transferred to any other U.S. broker-dealer. SIPC provides additional protection up to $500,000 per eligible account in case of clearing firm failure.
What is the maximum FDIC coverage for my cash?
Uninvested cash is programmatically distributed across a network of FDIC-insured partner banks through the Founders Cash Sweep program. Each bank provides up to $250,000 in FDIC coverage. With 32 participating banks, aggregate coverage reaches up to $8,000,000 per depositor.
Does SIPC protect against market losses?
No. SIPC protects against broker-dealer insolvency, not against declines in the market value of your securities. If your stocks lose value due to market movement, that is investment risk, not a custody or protection issue.
Can FoundersXTrade use my securities for its own trading?
No. Under SEC Rule 15c3-3, fully paid customer securities must be segregated from firm assets. Axos Clearing LLC performs daily reserve calculations to verify compliance. FoundersXTrade never re-hypothecates or uses customer securities for proprietary trading.
Are there any fees to withdraw my money from FoundersXTrade?
No. There are zero withdrawal fees, zero clearance fees, zero activation deposits, and zero hidden charges. Fund transfers follow standard U.S. ACH processing times (typically 1-3 business days).