Instead of holding pledged stock in trust accounts for its customers, says the complaint, Credit Bancorp put the shares in cashormarginaccounts, sold or borrowed against the stock and kept the proceeds, sometimes buying more securities with the money.
When equity prices decline steadily as they have been these last few days, marginaccounts get restricted and in the worst case, if cashor stock is not deposited to meet margin requirements, sales can be forced by the brokers to pay for margin debt used to buy the stock.