Since "Deepcapture" is apparently not accepting comments right now ( at least I can't post one) I'll post a comment here:

1. Securities are negotiable instruments because the states, starting in 1910 with the "Uniform Stock Transfer Act", made them negotiable instruments and they remain so to this day. This means that delivery by  the seller to  the buyer is necessary for the consummation of a securities transaction, as with all negotiable instruments.

2. The Uniform Commercial Code, adopted by all 50 states, regulates the rights of securities, the ownership of securities, the transfer of securities - among a few other things. Not federal law, but the states do this because securities issued by corporations have their genesis in state law.

Securities issued by federal or foreign entities are not regulated this way by the states and the UCC, but are regulated by FED rules and laws and possibly other federal authorities.

3. This means that the DTCC, when in comes to corporate equity securities,  relies most heavily on the UCC for what it does. The closest body of law and regulation of the DTCC are the states. A power the states are failing to exercise. The states have tremendous power they don't eve seem aware of.

4. If the states or the people of the states wanted to, they could start dictating to the DTCC bu amending the UCC. Any one large state alone, like Texas or California, etc,...could force the DTCC to change the way it does business. The UCC could be amended to require disclosure of failed transactions by the DTCC or anybody else for that matter, require investor money be returned,....anything we want really. The DTCC relies on whatever the UCC says and quotes the UCC all over the place for justification for what it does.

Just look at the DTCC talking here to show you what I mean:
DTCC quoting the UCC

As a matter of fact, the DTCC only quotes the UCC for justification for everything it does. Neither the SEC nor the Federal Securities Acts have jurisdiction over the form, ownership, holding or transfer of securities. The SEC and the DTCC can "talk" all they want, but securities depositories, ownership and transfer are reserved for the states to regulate and they do so via the UCC.

It would be very difficult for the US Congress to pass a piece of legislation that would transfer this responsibility from the states to the federal level, because of already existing US Supreme Court rulings saying that securities are creatures of state laws and that these aspects are reserved for the states. So fortunately, we're really stuck with the states being in charge of this aspect of securities. If only the states would wake up to their power.

The FEDS and the Securities Acts are responsible for shaping markets and behavior, not the more basic aspects of the securities themselves. The future fireworks will be at the state level. In fact, the NOVS and OSTK cases against the brokers already shows this.

For all these reasons, that's why on the NIPC website, I call for the states to amend their UCC. That's the angle on how to control the DTCC and ensure total transparency and stop the FTD fraud.
Solutions - NIPC