Securities Brokerage-Cash Management System With Short Term Investment Proceeds Allotted Among Multiple Accounts

This invention relates to financial business systems and, more specifically, to data processing methodology and apparatus for effecting an improved securities brokerage and cash management system.

It is an object of the present invention to provide an improved brokerage/cash management system.

More specifically, it is an object of the present invention to provide a data processing implementation for a brokerage-cash management financial system which provides for automatic investment of free credit cash balances in short term investments which include an insured savings account option; a full range of security brokerage transaction functions; which permits consumer transaction ("charge") card and check charges; and which includes safeguards against abuses, e.g., check kiting.

The above and other objects of the present invention are realized in specific illustrative improved securities brokerage-cash management system for supervising, integrating and coordinating a margin securities brokerage account; participation in one or more short term investments; and subscriber-initiated use of a transaction charge card and/or checks. Subscriber expenditures as by charge card use, check, and/or cash advance are applied on a hierarchal basis against the subscriber's free credit cash balance, short term investment and, finally, his securities equity. On a periodic basis, e.g., daily, received card, check, securities and deposit transactions for the ensemble of account participants are verified and employed to compute an updated credit limit for each subscriber.

In accordance with one aspect of the present invention, the short term investments available to subscribers include an ordered ensemble of insured savings accounts.

The foregoing and additional features and advantages of the instant invention will become more readily apparent from the following detailed description of a specific illustrative embodiment thereof, presented hereinbelow in conjunction with the accompanying drawing, in which:

FIGS. 1A and 1B are respectively the upper and lower portions of a schematic flow chart depicting the data processing methodology and structure in accordance with the principles of the present invention for an improved brokerage/cash management system of accounts;

FIG. 2 is a flow chart depicting data processing for the credit limit updating and overdraft functional blocks 26, 31 and 33 of the FIG. 1 overall data processing disclosure;

FIG. 3 is a flow chart illustrating updating a short term investment position functional block 45 of FIG. 1; and

FIG. 4 is a flow chart depicting representative insured savings account processing 68 of FIG. 1.

Referring now to FIG. 1, there is shown in overall scope a data processing and system operational flow chart for implementing an improved securities brokerage/cash management system incorporating the principles of the present invention. As contemplated by the present invention, there are three fundamental aspects of service offered to each of plural system subscriber. At the kernel of the overall system is a margin brokerage account in which each customer may effect the usual diverse array of securities and related transactions--e.g., those offered by a full service brokerage house. As a second facet, there is at least one and in general a plurality of vehicles for short term investment of funds, e.g., pooled trusts and, importantly for present purposes, insured savings accounts ("ISA"). These investment accounts and/or trusts, managed by a bank, fiduciary or custodian with ancillary services possibly furnished by an investment advisor or the like, provide each system subscriber with one or more ways of earning yield on funds not then required for other purposes herein discussed. Such excess funds may be generated by subscriber deposits; by dividends or interest paid on securities in the subscriber's brokerage account; may represent proceeds of sale, securities redemption or like transactions in the brokerage account; or the like. The third and final aspect of the instant system arrangement comprises a transaction ("charge") card and a checking account. The transaction card is usable at the subscriber's sole discretion, under his control, to charge goods and services offered by those accepting the charge card. The charge card may be independent or may be affiliated with some charging system, e.g., the well known "VISA" charge system. The bank checks require no explanation and are simply payment orders drawn against the bank. The check amounts are satisfied from the subscriber's free credit balance, short term investment position or his securities margin account in that order.

By way of brief overall philosophy, charges created by the transaction card and checks drawn against the bank are accumulated by the bank and transmitted to the brokerage house. The brokerage house establishes a credit limit against which each subscriber may use his transaction card and bank checks. The credit limit applicable to each subscriber is in the most fundamental of terms the value of the subscriber's free credit cash as represented by free cash in the brokerage account and by the subscriber's short term investment(s), plus the remaining loanable value of the subscriber's securities. A more precise statement of credit limit and the data processing methodology to determine same is set forth below. Any income or receipts for the subscriber's account, e.g., dividends, interest, sale or redemption proceeds from a securities account or the like, are applied to the overall subscriber's account in a predetermined, hierarchal manner to offer the subscriber either a maximized return or a minimum interest charge. In particular, any received or generated funds are first applied to reduce or eliminate any subscriber overdrafts. Following this, the funds or any remaining portion thereof reduce the subscriber's margin balance. Any excess as a general matter is then automatically invested for the subscriber in the one or more short term investment vehicles which the subscriber has selected or is entitled to pursue.

Correspondingly, when funds are required of the subscriber to satisfy any transaction or check charges or the like, they are obtained from the composite subscriber account in a hierarchal, priority sequence least negatively impacting the customer. Such funds exceeding yet uncommitted brokerage account cash are first obtained by liquidation of the appropriate short term investments. Any excess requirement is then generated in the form of a margin loan against the subscriber's securities. Should this be insufficient, the overage takes the form of an overdraft loan by the bank to the subscriber subject to the bank's discretion and willingness to provide such an overdraft loan.

With the above overview in mind attention will now be directed to FIGS. 1A and 1B herein, referred to as composite FIG. 1, which is a schematic flow chart in overall scope of the data processing of the instant invention for effecting the above described operations. The functional blocks 26, 31, and 33, 45, and 68 of FIG. 1 are expanded in the more detailed level flow charts of FIGS. 2-4, respectively.

Beginning at the top of FIG. 1, the bank first transmits to the brokerage central processing unit a record of all transactional information for each of the system subscribers, together with subscriber identification. Thus, each entry will include a subscriber identification, and transactional information such as a transaction card charge or credit (e.g., credit for returned charged merchandise) or a check identification and amount (functional block 10). A cross reference file 13 is maintained at the brokerage central processing unit of system subscribers, this being updated by manual or automatic entries 12. The incoming transactional information from the bank is verified at functional block 14. The verification assures (i) that the reported transaction is for a subscriber who is in fact known to and authorized by the system; and (ii) it verifies transmission and accuracy of the incoming information--e.g., by the per se well known system of verifying totals across batched lots of fixed, predetermined size of incoming transactional records.

Most typically, the verification will prove out ("N.0." output of "OUT-OF-BALANCE" test 15), and system flow passes to the next following test 20 to assure that the customer is identified in the master file which also will typically be a test that is satisfied ("YES" output of block 20). If, however, test 15 fails ("YES" output), the OUT-OF-BALANCE total is corrected from a suspense account (block 17), and a printed report of the discrepancy generated (function 18) before passing to the next following customer verification. Similarly, if test 20 fails, a proper identity is created in the Master File for the customer whose transaction is being processed, and system flow passes for succeeding operations. Finally for initializing processing, manual transaction entry 22 is employed to correct items needing manual intervention to account for errors, fraud items, stolen checks, or the like.

Following such reception and verification of incoming items, the received transactional information is employed in functional block 26 to compute or update the then obtaining credit limit for each customer. As above noted, the functions performed by the block 26 are set forth in expanded detail in the flow chart of FIG. 2 discussed below. In brief terms at this point, it is the office of processing for block 26 to provide a credit limit computational variable CRDLT(I) which is the credit remaining available to each of the I customers or subscribers to the system. That is, CRDLT(I) is the amount of credit remaining to the I-indexed customer for use of his transaction card and checks. This credit limit CRDLT(I) is reported for each customer to the bank for purposes of honoring charges, checks, credit advances and the like. For convenience and conciseness of presentation, all indexed variables (such as CRDLT(I) above discussed) are sometimes shown without their index. It will readily be appreciated that all per-subscriber variables are in fact so indexed. Further for ISA processing set forth below, doubly indexed variables (I-for subscriber; J-for bank) are utilized.

The functional block 26 is supplied with all customary brokerage data stored in a brokerage account data file 27. The particular ensemble of variables supplied to the credit limit computational processing 26 via file 27 are set forth in detail below in conjunction with the FIG. 2 expanded presentation of credit limit computation. In very brief terms, they include such as the short term (e.g., ISA and/or money market) investment position of each subscriber, the worth of his securities in the brokerage account, margin buying or loan power, and the like. The file 27 is as above noted maintained in the customary fashion in the brokerage house to reflect the customer's status. As one additional external entry (functional block 28), the short term investment dividends and interest earned for the customer is periodically reported and reflected at the customer's storage in the account data file 27.

As part of credit limit updating, the customer's account is examined for an overdraft condition (test 31). Overdraft examination and processing is also set forth in detail in the FIG. 2 processing. If the customer has overdrawn his account, i.e., overdrawn his "credit limit", a temporary loan is extended to the customer (functional block 33). The customer is notified of the overdraft condition and required to clear the overdraft unless the bank is willing to extend a loan to the customer in a manner de hors his brokerage account and the FIG. 1 system.

Following credit limit functioning, the ensemble of credit limit variables CRDLT are supplied to the bank (function 29). This list of customer credit limits is employed at the bank to limit the credit available in its several forms to each of the subscribers, i.e., to limit the aggregate of usage of the customer charge card, checks and cash advances (via the card or check) which are supportable, from the customer's assets. As a further matter, and as part of the functioning block 26, the credit limit variable also updates each customer's record in the master file (operation 122, FIG. 2).

A history file or stored record is kept of the customer's transactions (block 35) for various purposes, including preserving data to generate periodic monthly statements. Following this, tests 37 and 39 operate on the historical transactional data for the customer to flag possible system abuses, e.g., check "kiting" where deposits are made to obtain money market interest, and the deposited proceeds withdrawn to cover the initial check before it clears. To uncover and prevent repetitive such abuses and others, the tests 37 and 39 respectively determine whether or not three substantial deposits (test 37) or withdrawals (test 39--e.g., card charges, cash advances or checks) exceeding some predetermined threshold such as $10,000 have occurred within a predetermined time period such as one month. If either of the tests 37 or 39 is answered in the affirmative, an output report is printed 40 to signal the incidence as a matter for investigation. Thus, for example, a dump of the entire account history might take place for evaluation.

The overall program flow next passes to operation 45 to selectively update the short term investment position (increment or decrement) depending upon whether excess cash has been generated by subscriber transactions and should be placed for short term investment; or whether cash is required for varying purposes. Again, detailed processing for the functional routine 45 is set forth in FIG. 3, which will be described in detail hereinbelow. Accordingly, functioning for the block 45 is discussed only briefly at this point in overview. The processing 45 is supplied with several variables such as manual entries 48 which might reflect monetary deposits by the customer with short term investment buy instructions; is supplied with master file information for all customers at block 49; and is finally supplied with information at block 43 reflecting security transactions (e.g., as part of the per se normal brokerage account data file). The output of update money market position processing 45 are a buy vis-a-vis sell variable for each account, together with the amount to be bought and sold.

As above noted, each system subscriber has the option to participate in one or more of several short term investment opportunities. To this end, test 65 determines whether these customers' excess funds are to be invested in an insured savings account. If they are not, i.e., if the subscriber whose account is then being processed has opted for one or more of the other funds to the exclusion of ISA participation, one or more additional tests 53 determine the proper short term investment money market account for the customer and a report is then generated to the custodian of the appropriate money market trust to reflect the increase/decrease for the subject customer. Thus, for the assumed situation of one taxable and one tax free money market funds (in addition to the insured savings account), if test 53 determines from the subscriber's data block that a tax free (or some other) money market fund has been elected as the customer's primary short term investment vehicle, block 57 issues an appropriate data report to the custodian for the tax free money market trust. Correspondingly, if test 53 notes a taxable trust election by the customer, block 55 issues a data report to the custodian of that trust.

Assuming that block 65 confirms that the customer has opted to have his short term investments in an insured savings account (i.e., money market deposit ("MMDA") account insured by the Federal Deposit Insurance Corporation, or Federal Savings and Loan Insurance Corporation, test 65 supplies a "YES" determination. There follows one or more functional block 68(J) associated with the processing of the subscriber's short term investment at that specific (J-th) bank. More specifically, by government regulation, there is a limit (currently $100,000) on federal insurance for the money market deposit account at any one banking institution. Accordingly, for each system subscriber there is an ordered hierarchy of banks in which the subscriber's short term investment is placed such that the subscriber deposits do not exceed the $100,000 limit in any institution. Thus, for subscribers with less than $100,000 in short term investable funds, only one bank need be involved such that only one functional block 68 is invoked for that subscriber. As the subscriber's deposit grows near or above the insurance threshold (preferably with a margin as discussed below), other functional blocks 68 associated with other banks are called upon. Suffice it for present summary description purposes, the incremental funds to be added to or removed from the customer's insured money market deposit account(s) are accommodated by iterative operation of one or more of the similar bank processing functional routines 68. As part of such processing, reports are generated to the respective institution(s) for deposit/liquidation purposes.

Finally, the short term investment transactions are reported to the account data processing 60 to update each subscriber's account data file; are employed to update the subscriber's master file (61); and are used to update the customer's local data base (step 62) as in his local brokerage office.

That completes the data processing in overview for one complete operation of the system, as for a daily iteration. The next following day, the system will re-execute the functional operations of FIG. 1 employing the new set of operands generated during the day following the previous iteratin in the manner above discussed.

Referring now to FIG. 2, there is shown a detailed flow chart for credit limit updating and overdraft processing corresponding to functional blocks 26, 31 and 33 of composite FIG. 1. It is again the overall purpose of the FIG. 2 flow chart to generate the credit limit variable CRDLT for each of the I-system customers to reflect the remaining available worth of that customer's assets. For purposes of FIG. 2 processing, the following variables (again, all indexed by subscriber but shown without index which remains understood) are employed:

With the above variable definitions in mind, attention will now be directed to the processing of FIG. 2. As a first matter, the value of "today's transactions" (a computational variable TTRAS), i.e., the value of all transactions for the customer for the subject processing day, is computed as the algebraic sum of the checks (CKS), charges (CRGS), cash advances (CASHAV) and credits (CREDTS). A didactic fortran-type statement is

Test 81 first determines whether either of the special and miscellaneous or firm maintenance excess values for the subscriber (SMA OR FME variables) is equal to zero which would indicate that no customer borrowing power remains in the subscriber's brokerage account, applying the more rigorous of the two standards. Assuming test 81 fails ("N.0." branch) thus signalling that the customer does have remaining borrowing power, test 83 determines whether the Federal Reserve (SMA) or brokerage firm internal (FME) standard is the more stringent and, depending upon the outcome, sets a computational intermediate credit variable CT equal to the lesser of the SMA or FME stored values (steps 88 and 90). A further computational credit limit variable CTR1 is then set equal to the sum of the CT variable (lesser of FME or SMA) plus the sum of the customer's short term investment amount (MMKT),

(functional block 92).

The processing variable CRT1 is updated (block 96) to be decremented for amounts due in the account for Federal Reserve Regulation T calls (REGTCL), maintenance calls (MNTCL), the amounts expended in the day's transactions (TTRAS) and the cash balance (CASHBL) due for cash account processing.

The variable CRT1 following processing 96 represents a provisional credit limit for the subscriber subject to further processing below discussed.

The above described functioning followed when test 81 noted positive lendable proceeds remaining in the subscriber's brokerage account ("N.0." output of test 81). Assuming there to be no such lendable amount--i.e., where the subscriber has no marginable securities or where they are already fully margined ("YES" output of test 81), test 85 then determines whether customer money market (MMKT) value is greater than zero, i.e., that the customer has a long short term investment position although he has no marginable securities. Assuming this to be the case, test 98 determines whether funds are required of the account to satisfy Regulation T calls, expenditure transactions or the like. If so ("YES" output of test 98), the provisional computation variable for the customer CRT1 is set equal to his money market balance less the amount needed to satisfy fund requirements in a manner analogous to that given above with respect to statement (3), as by:

(functional block 105).

The provisional credit variable CRT1 as defined at the output of functional block 96 or 105 is supplied to test 110 to assure that the provisional variable CRT1 is positive. If it is ("YES" output of test 110), the customer credit limit variable CRDLT is set equal to CRT1 (114) thus completing execution of the FIG. 2 processing. If the provisional credit variable CRT1 is not greater than zero ("N.0." output of test 110)--as by debit transactions exceeding the money market and borrowing power of the customer's securities the credit limit variable for the customer is set equal to zero (block 112). Functional block 116 next determines whether or not the customer's transactions TTRAS exceed the absolute value of the provisional credit limit CRT1 and functional blocks 118 and 121 generate a new loan amount NLOAN as the lesser in absolute value of the transactions (118) or provisional credit limit (121). This, again, completes processing for the customer with zero value in CRDLT, an appropriate new loan amount NLOAN being generated.

Continuing with respect to FIG. 2 processing, if the customer has no borrowing power in his securities account ("YES" output of test 81) and has no short term investment value ("N.0." output of test 85), and if he has generated transactions (TTRAS) by using his charge card or checks notwithstanding the absence of anything to support such transactions ("YES" output of test 87), a new loan is established equal to his transactions (step 100), his credit limit is set equal to zero (102), and an exit is made from FIG. 2 processing. As a final mode of FIG. 2 processing, if the customer has a positive money market balance ("YES" exit from test 85), and has no current cash requirements ("N.0." output of test 98), his credit limit is set equal to his money market balance (functional block 103) and exit is made from FIG. 2 processing.

Thus, the above described operation of the FIG. 2 credit limit and overdraft processing (functional blocks 26, 31 and 33 in FIG. 1) computes the credit limit CRDLT(I) for each of the system's customers, i.e., the amount remaining to that customer for use by his charge card, checks and cash advances. Also computed by such processing is the incremented loan value NLOAN(I) to be added to the customer's overdraft.

Referring now to FIG. 3 there is shown a detailed flow chart which executes the updated short term investment position functioning operation 45 of FIG. 1, i.e., determines whether or not short term investments should be increased or decreased and, if so, by what total amount. Such processing involves as variables:

Again, it will be appreciated that each of the above variables is actually indexed to reflect each such quantity for each customer. The indexing variable (I) has been deleted for convenience.

Referring now to the flow chart of FIG. 3, as a first matter, a processing net present account balance variable ACBAL1 is computed to be the cash balance ACBAL, less funds required to pay for the customer's use of his charge card, checks and the like (TTRA), or to pay amounts due in his brokerage account which are either overdue or which will be settling during the next day (TOMSET), as by

(block 130). In FIG. 3, it is assumed that short term investment purchases will occur only once per week, as on a Friday--and functional block 132 determines whether or not the particular iteration of FIG. 3 processing is taking place at the predetermined, e.g., Friday time. If it is ("YES" output of test 132) and if test 136 confirms that the provisional variable ACBAL1 is positive ("YES" output), processing enters a BUY subroutine. Accordingly, the buy/sell distinguishing output variable BUY/SELL is set to a buy condition (e.g., by loading the variable BUY/SELL with a positive integer--functional block 155), and the amount of short term investment AMT variable is loaded with the provisional sum ACBAL1 (step 157).

Correspondingly, if test 136 provides a "N.0." output signalling that the subscriber charges exceed the surplus funds in his securities account, the data processing enters a SELL subroutine to sell sufficient short term investment assets to obviate the difference or cash requirement (assuming such shares to exist). Test 138 determines whether or not the customer has a short term investment position (i.e., whether MMKT exceeds zero). If he does not, his margin loan is increased (139) and FIG. 3 processing exits. Assuming the subscriber does have a positive short term investment (MMKT) balance, step 140 sets the buy/sell BUY/SELL variable to the sell condition (e.g., a stored negative integer). Test 141 then determines whether the account balance provisional variable ACBAL1 exceeds the short term (MMKT) position and, depending upon the results of the test, the amount (AMT) variable of short term funds to be liquidated is set to the lesser of the money market MMKT (step 145) or ACBAL1 variable (step 143) as appropriate. If all his short term position is sold (145), the difference between what the customer needs and his MMKT amount opens a margin loan transaction (144).

Turning now to the alternate or "N.0." branch of test 132 (which presumes that the current iteration of processing is not the money market buy/sell assumed Friday date), test 133 first determines whether the net account balance ACBAL1 which reflects subscriber expenditures is positive. If it is not, the "N.0." exit of test 133 enters the SELL subroutine above discussed to sell either all the short term position or a lesser amount if that will suffice to cover the subscriber's expenditures and securities requirements. Assuming ACBAL1 is positive, indicating an excess of cash over requirements in a customer account ("YES" exit of test 133), functional block 135 computes a computational variable ITEMS which is the sum of variables representing yesterday's deposits (DEPYT), securities sales settling tomorrow (TOMSET), and immediate settlement items such as redemptions (IMSET) as by

It is desired that the subject proceeds reflected in ITEMS be invested in a short term account immediately and not await the next investment (assumed Friday) date. If such items ITEMS exceed ACBAL1 (test 149) provides a "YES" output; a processing variable INAT is set equal to zero (step 153) and processing enters the BUY subroutine to purchase the requisite savings account balance or money market shares by setting the BUY/SELL variable to the buy condition (155) and loading the AMT variable with the ACBAL1 value. If the immediately investable ITEMS amounts are less than ACBAL1, ACBAL1 is set equal to ITEMS (step 150), the computational variable INAT is set equal to the difference between the processing variables ACBAL1 and ITEMS by

and the BUY subroutine is entered as above discussed. The foregoing processing is required since two ITEMS constituents DEPYT and IMSET are inherently reflected in ACBAL and therefore in ACBAL1 and must not be twice counted.

Finally, functional blocks 158, 159, 160 and 162 accommodate manually entered buy commands. If there is an unprocessed manual buy command as sensed by test 158, test 159 sets the purchase variable ACBAL1 equal to the lesser of INAT (162) or the manual buy (MANBY) (160) and the BUY loop is entered to purchase the appropriate amount (AMT). Once this is done, the next iteration through test 158 will reflect that the manual buy has been processed, at which point the composite processing of FIG. 3 is completed and the "YES" exit of test 158 passes to the exit of FIG. 3.

Turning now to FIG. 4, there is shown in more specific detail system functioning for an illustrative one of the bank processing blocks 68(j) discussed in overview above with respect to FIG. 1. To briefly reiterate, it is a principal object of this invention to provide a system arrangement which permits each subscriber to the instant securities brokerage-cash management system to invest his uncommitted monetary assets at his option in money market deposit (MMDA) accounts, i.e., savings accounts at commercial or savings banks, or the like where those short term investments are protected by insurance from federal agencies. As part of the overall processing it is recognized that the F.D.I.C./F.S.L.I.C. will protect a subscriber at any individual bank for deposits up to a maximum amount set from time to time by governmental edict, e.g., $100,000 at present. Moreover, that amount covers the aggregate of all deposits by the specific customer at the particular financial institution, to include certificates of deposit as well as MMDA amounts. Accordingly, processing for the instant invention allots a maximum of $97,500 to any specific institution for all of the customer's deposits, permitting an incremental amount ($2,500 for the assumed strategy) for account growth by way of interest.

Moreover, financial institutions are allotted to customers on a hierarchal, ordered basis such that customer deposits fill a first (highest priority) institution up to the allotted $97,500 before opening an account with a second, next highest priority institution and so forth. Alternatively, input apparatus 161, e.g., a manually operated keyboard, can enter a specific desired bank identification.

Absent overriding manual instructions, subscribers are allotted to banking institutions in accordance with any useful strategy, e.g., by matching a subscriber with banks in a geographically distant location to reduce the probability of customer certificate of deposit relationships with that institution (thus preserving all or substantially all of the $97,500 for MMDA purposes). Banks in the distant area may be pre-assigned to customers in a fixed, predetermined hierarchy; or may be assigned on a probablistic basis.

It will also be appreciated that additional monetary restrictions may be accommodated where possible. Thus, MMDA accounts may be characterized by a $2,500 minimum threshold to earn interest at a money market equivalent rate. It is thus desirable to maintain at least that $2,500 sum in all insured savings accounts for each customer even where one or more of the accounts will have less than the system predetermined upper bound, i.e., less than $97,500 while a second, lower priority institution has $2,500 or so on deposit. Finally, it must be recognized that each bank may have a maximum overall participation for all customers (i.e., can usefully accommodate only a certain amount of short term deposits) subject to the constraint that once accepting a deposit from a customer the institution will permit the customer to fill up his $97,500 allotted amount. Other financial strategies and adaptations will be readily apparent without departing from the scope of the present invention.

With the foregoing in mind, data processing variables for FIG. 4 processing include:

Referring specifically now to the flow chart of FIG. 4, there is shown an operational flow chart for an illustrative bank processing block 68(J) of FIG. 1 operative in an account opening/increasing mode as when functional block 45 (FIGS. 1 and 3) furnishes an amount AMT to be deposited on behalf of the i-th customer in an insured savings account. Further, a specific (j-th) bank of highest priority for the customer is identified--either by manual input from entry apparatus 161 or automatically on the above-described geographically remote basis. Functional block 162 first determines whether or not the illustrative j-th bank is at or exceeds its maximum, i.e., has all the short term deposits which it desires to receive. If the upper bound is attained or exceeded ("YES" output of test 162), a test 165 determines whether the present balance for the i-th customer (BAL(I,J)) is greater than zero, i.e., determines whether the i-th customer already has an opened account with a non-zero balance at the institution. If not ("N.0." output of test 165), processing flows to the bank next in order (block 68 (j+1) for the j+1st bank) to accommodate the deposit requirements for the i-th customer. However, for the usual case where the subject j-th bank is not at maximum ("N.0." output of test 162), or where the customer already has a balance at the bank ("YES" output of test 165), processing continues within the context of block 68(J).

The next sequence of processing operations 168, 170, 173 and 176 are utilized to assure that a deposit is not made in an institution below the minimum (assumed $2,500) threshold. Test 168 determines directly whether or not the sum of the customer's existing balance (BAL(I,J)) together with the amount to be deposited (AMT) is less than $2,500. If it is not ("N.0." output of test 168) there is no difficulty with the minimum MMDA threshold and processing skips to test 180 below discussed. However, if there is a threshold problem ("YES" output of test 168), $2,500 is borrowed from the customer's next most senior MMDA account institution (the J-1 bank), as by

The result of this transaction is communicated to the subject J-1 bank (block 173) and the amount to be deposited (AMT) is increased by $2,500,

(functional block 176).

Test 180 next determines whether the sum of the amount to be deposited (AMT), the customer's existing MMDA balance (BAL (I,J)) and the certificates of deposit by the customer at that institution (CD(I,J)) exceeds the allotted upper bound, as by program branching depending upon the inequality

(block 184). If they do not ("N,.0." output of test 180), the entire amount to be deposited (AMT) may be deposited in the j-th bank for the i-th customer and this may be effected by

An appropriate report is issued to the j-th bank to implement the deposit (block 186) at which point processing returns to block 60 of FIG. 1 above discussed.

If test 180 determines that the full amount to be deposited (AMT) would overflow the insured predetermined limit for the j-th bank ("YES" output of test 180), processing passes to block 181 to determine that partial amount (AVAIL), if any, of the total amount (AMT) which may be deposited in the j-th institution, i.e., the amount by which the total of the customer's balance (BAL(I,J)) and certificates of deposit (CD(I,J)) do not exceed the limit as by

If the available amount (AVAIL) is zero or negative ("N.0." output of test 190), none of the amount to be deposited (AMT) will be accommodated at the j-th bank and processing passes to the j+1 bank to seek investment there. Assuming, however, that AVAIL is positive ("YES" output of test 190), functional block 192 increases the balance at the j-th bank up to the $97,500 limit, as by

and block 194 decreases the amount (AMT) to be deposited by the funds (AVAIL) taken by the j-th bank,

A report is rendered of the funds (AVAIL) deposited in the j-th bank (block 196) and processing passes to the sequence of operations 68 (J+1) to process the modified amount AMT resulting from step 194.

Thus, the bank processing 68 illustrated for the j-th bank in FIG. 4 may identically recur on a bank by bank basis until the entire amount has been invested or the sequence of banks exhausted (at which point other contingent money market trusts may absorb the remainder). Alternatively, the last bank in the hierarchy being the least most probable for the i-th customer, may simply agree to accept all deposits. While the processing above described has focused on the acceptance of deposits, withdrawals occur in a directly analogous manner, liquidating funds seriatim from the bank having the lowest order priority for the customer up through the highest order until all funds required to satisfy charges have been liquidated. If desired, functioning paralleling blocks 168, 170, 173 and 176 may be utilized to maintain a minimum deposit (e.g., $2,500) at each institution.

The above described composite arrangement has thus been shown to provide an improved securities brokerage/cash management system which supervises and integrates a brokerage account, a charge card, checking, and one or more short term investments which include insured savings accounts, providing great flexibility for the account subscriber, while providing insured earned income for funds not invested or required to satisfy expenditures.

The above described arrangement is merely illustrative of the principles of the present invention. Numerous modifications and adaptations thereof will be readily apparent to those skilled in the art without departing from the spirit and scope of the present invention.