Let’s be clear about this because segregation is one of the most misunderstood and abused concepts in clearing. Segregation is designed to protect clients from the failure of the clearing bank or company they are with, so in a "Lehman’s" or "Barings" type scenario client money is protected.
What it does not do, anywhere, is protect one client from another client, in so far as if a client blows up big time and takes a huge portion of the segregated client pot of funds with it, then the clearing company has to make good the loss, up to the balance sheet of the company. So if you take Griffen as a case in point, they had segregated client funds, a client in that pot of segregated funds blew up and the entire balance sheet of Griffen could not cover the loss, and everybody lost out.
The key thing to remember is this, anyone who tells you your money is safe does not know what they are talking about, your only protection is the balance sheet of the company you are clearing, not the parent, the name on the top of your clearing contract and how good their risk management is.
The ultimate is system called "designated segregated" which would require the clearing company setting up a dedicated bank account for every client that opens an account and that would costs a fortune to set up and run and nobody offers that. All segregated accounts are pooled client accounts and as such are as good as the weakest client in the pot, so when you open a clearing account find how much leverage they are offering clients because if they offer multiples of leverage and high risk your money is funding that risk.
