Professional Clearing Member liability excludes unverified client positions and Trading Member defaults without statutory duty or privity.

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....Professional Clearing Members had no statutory duty or real-time regulatory visibility to verify individual Trading Member clients' debit and credit positions before collateral liquidation; the applicable framework treated the Trading Member as their constituent and restricted cross-use of margin only between Trading Members. No regulatory breach was established. Clearing committees could not order restitution of liquidated securities or block equivalent collateral, because stock-exchange bye-laws excluded monetary penalties and no substantive statutory power supported those measures. Individual clients had no claim against Professional Clearing Members for Trading Members' defaults under illegal assured-return schemes, absent privity or re.........