What exactly happens if a broker runs out of funds? Could you actually lose equity in your account? If so, what should you be examining when looking at the financial report of your broker?
The Securities Investor Protection Corporation is roughly analogous to the FDIC for investments. There are some important differences like a lack of 100% guarantee you get all of your funds back.
The SIPC understands you invested knowing there was some risk, and therefore you take that same risk in getting your money from a failed brokerage. However there is still a level of commitment and trust that lessen the risk of investing in the wrong place.
Also, do not typo the acronym at your work computer. In the US (and perhaps elsewhere) it is a racist term, and you are likely to get some bad search results.
Look at the link to the SIPC. I don't know exactly what you mean by "runs out of funds," but the SIPC will replace shares of stock stolen from your account, and up to $100,000 in cash.
The real risk is when a shady brokers sells you shares in a stock that becomes worthless, that's when "buyer beware" kicks in. No help there.
Careful with the "stock stolen from your account" thing. SIPC protects investors against broker/dealer insolvency. Don't think they provide protection against theft.