specifically, how does cipa apply when a customer's brokerage statements show nonexistent positions in real securities that the broker concocted after the facts to support predetermined fictional investment returns? two primary approaches have been proposed. the first is known as the final account statement method. under this method, the net equity in customer accounts would be based on the securities position shown on the final account statements customers received before the firm was placed in liquidation. the second principle approach is the cash in, cash out method. under this approach, net equity is determined by crediting the amount of cash the customer deposited in the account and subtracting any amounts withdrawn from the account. based on our analysis, the commission will recommend to the bankruptcy court the customer claims in this case should be determined through the cash in, cash out method advocated by the trustee. however, we believe that the amount should be adjusted to constant dollars to ensure that investors' claims in the long-running scheme are valued most accurate

and therefore, generally is entitled to recovery of those securities within the limits imposed by cipa, a financial limitation of $500,000 or whatever it is, even when the purchase never actually occurred and the debtor instead converted the cash deposited by the claimant to fund the purchase. these people were again reassured that the way we wrote the law, the way the regulations existed, and the way you interpreted them, telling them that they're entitled to that money even if -- and i won't go on reading, but even if the money triples and there was no money there and if somebody fraudulently stole it. what has happened is there is a different court case and you say the money was stolen and not invested. this is a shell game that you're playing with investors. this is over the heads of most of the people on our committee i would think have this happen and that this is being done. people relied on you and they were let down and we have to all collectively figure out a way collectively to make them as whole as we can make them. >> thank you, mr. ackerman. now to the gentleman from new

specifically, how does cipa apply when a customer's brokerage statements show nonexistent positions inreal securities that the broker concocted after the facts to support predetermined fictional investment returns? two primary approaches have been proposed. the first is known as the final account statement method. under this method, the net equity in customer accounts would be based on the securities position shown on the final account statements customers received before the firm was placed in liquidation. the second principle approach is the cash in, cash out method. under this approach, net equity is determined by crediting the amount of cash the customer deposited in the account and subtracting any amounts withdrawn from the account. based on our analysis, the commission will recommend to the bankruptcy court the customer claims in this case should be determined through the cash in, cash out method advocated by the trustee. however, we believe that the amount should be adjusted to constant dollars to ensure that investors' claims in the long-running scheme are valued most accuratel