Trillions of dollars worth of stock certificates might have been destroyed in a flooded vault at the Depository Trust & Clearing Corp. (DTCC), according to the Financial Times.
DTCC, a Wall Street-owned organization that manages parts of the U.S. trading infrastructure, houses 1.3 million paper certificates for shares, bonds and other financial instruments, including foreign securities, at its headquarters in Manhattan’s financial district.
On Thursday, the group said its vault was still underwater due to flooding from Superstorm Sandy and officials had not yet assessed the damage.
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“The building itself remains inaccessible and will be until power is restored and an on-site health and safety inspection can be completed,” the DTCC warned in an email alert to its clients, according to the Times.
“Although sea water levels have returned to normal, the lower floors in the building remain flooded. Our computer records are fully intact, including detailed inventory files of the contents of the vault,” said Michael Bodson, CEO of DTCC.
The organization has stopped processing all physical certificates for an indefinite period.
It also reported it was still looking for certificates that were in the mail during the time period of the storm. Mail couriers are experiencing delays due to the storm, and it is expected to take several days to get deliveries rerouted to DTCC’s alternative sites.
An unidentified DTCC spokeswoman noted that it has electronic records of all the certificates, which could be reissued.
“Hindsight is 20/20," she said. "We have taken a lot of precautions, in terms of protection both for the security of our systems and of our records, and we have a full inventory of the certificates, as well as a robust recovery plan.”
The group explained that it switched its systems to backup servers and was managing electronic trades as normal from its offices in Dallas, Tampa, Fla., and Brooklyn, N.Y.
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