Related provisions for CASS 7.13.76
1 - 15 of 15 items.
Where a firm receives client money in the form of cash, a cheque or other payable order, it must:(1) pay the money in accordance with CASS 7.13.6 R, promptly, and no later than on the business day after it receives the money into a client bank account, unless either:(a) the money is received by a business line for which the firm uses the alternative approach, in which case the money must be paid into the firm's own bank account promptly, and no later than on the business day after
If a firm intends to pays its own money into a client bank account under CASS 7.13.41 R it must establish a written policy that is approved by its governing body (and retain such policy for a period of at least five years after the date it ceases to retain such money in a client bank account under CASS 7.13.41 R) detailing:(1) the specific anticipated risks in relation to which it would be prudent for the firm to make such payments into a client bank account;(2) why the firm considers
A firm must create and keep up-to-date records so that the amount of money paid into client bank accounts and retained as client money pursuant to CASS 7.13.41 R or withdrawn pursuant to CASS 7.13.49 R, and the reasons for such payment, retention and withdrawal can be easily ascertained (the prudent segregation record).
The prudent segregation record must record:(1) the outcome of the firm's calculation of its prudent segregation;(2) the amounts paid into or withdrawn from a client bank account pursuant to CASS 7.13.41 R or CASS 7.13.49 R;(3) why each payment or withdrawal is made;(4) in respect of the firm's written policy required by CASS 7.13.43 R the firm must record, as applicable, either:(a) that the payment or withdrawal is made in accordance with that policy; or(b) that the policy will
A firm that uses the alternative approach for a particular business line must, on each business day ('T0'):(1) receive any money from and pay any money to (or, in either case, on behalf of) clients into and out of its own bank accounts; (2) perform the necessary reconciliations of records and accounts required under CASS 7.15 (Records, accounts and reconciliations);(3) adjust the balances held in its client bank account (by effecting transfers between its own bank account and
(1) A firm that uses the alternative approach must, in addition to CASS 7.13.62 R, pay an amount (determined in accordance with this rule) of its own money into its client bank account and subsequently retain that money in its client bank account (alternative approach mandatory prudent segregation). The amount segregated by a firm in its client bank account under this rule is client money for the purposes of the client money rules and the client money distribution rules.(2) The
A firm must create and keep up-to-date records so that any amount of money that is, pursuant to CASS 7.13.65 R:(1) paid into a client bank account and retained as client money; or(2) withdrawn from a client bank account;can be easily ascertained (the alternative approach mandatory prudent segregation record).
The alternative approach mandatory prudent segregation record under CASS 7.13.66 R must record:(1) the date of the first determination under CASS 7.13.65 R (2) and each subsequent review undertaken under CASS 7.13.65 R (4), and the total amount that the firm determined was required to be segregated under CASS 7.13.65 R (2) as at that date;(2) the date of any payment of the firm's own money into a client bank account, or withdrawal of any excess from a client bank account under
(1) Where the circumstances described in CASS 7.13.72 R (1)(a) apply to a firm it must pay an amount (determined in accordance with this rule) of its own money into its client bank account and retain that money in its client bank account (clearing arrangement mandatory prudent segregation). The amount segregated by a firm in its client bank account under this rule will be client money for the purposes of the client money rules and the client money distribution rules. (2) The amount
A firm must create and keep up-to-date records so that any amount of money that is, pursuant to CASS 7.13.73 R: (1) paid into a client bank account and retained as client money; or(2) withdrawn from a client bank account;can be easily ascertained (the clearing arrangement mandatory prudent segregation record).
The clearing arrangement mandatory prudent segregation record under CASS 7.13.74 R must record:(1) the date of the first determination under CASS 7.13.73 R (2) and each subsequent review undertaken under CASS 7.13.73 R (4), and the total amount that the firm determined was required to be segregated under CASS 7.13.73 R (2) as at that date;(2) the date of any payment of the firm's own money into a client bank account, or withdrawal of any excess from a client bank account under
So that a CASS debt management firm may check that it has sufficient money segregated in its client bank accounts to meet its obligations to clients for whom it is undertaking debt management activity, it is required periodically to carry out reconciliations of its internal records and accounts to check that the total amount of client money that it should have segregated in client bank accounts is equal to the total amount of client money it actually has segregated in client bank
The checks that a CASS small debt management firm is required to undertake under CASS 11.11.8 R include checking that its internal records and accounts accurately record the balances of client money held in respect of individual clients, and that the aggregate of those individual client money balances are equal to the total client money segregated in its client bank accounts. In undertaking the comparison between the internal records of balances of client money and the client
Where the check of its internal records and accounts that a CASS small debt management firm is required to undertake under CASS 11.11.8 R reveals a difference between the amount of money it holds in its client bank accounts and the amount of client money that should be held and segregated under CASS 11.9, a CASS small debt management firm must:(1) ensure that any shortfall in the amount held in its client bank accounts as compared to the amount that should be held there is made
A CASS debt management firm must inform the FCA in writing without delay if:(1) its internal records and accounts of client money are materially out of date or materially inaccurate so that the firm is no longer able to comply with the requirements in CASS 11.11.1 R to CASS 11.11.4 R; or(2) it becomes aware that, at any time in the preceding 12 months, the amount of client money segregated in its client bank accounts materially differed from the total aggregate amount of client
(1) 1Under CASS 7.7.2 R (2), a firm acts as trustee for all client money received or held by it for the benefit of the clients for whom that client money is held, according to their respective interests in it.(2) A firm that is also a clearing member of an authorised central counterparty may wish to segregate client money specifically for the benefit of a group of clients who have chosen to clear positions through a net margined omnibus client account maintained by the firm with
(1) The records maintained for a sub-pool under CASS 7.19.4 R must identify all the client beneficiaries of that sub-pool.(2) The beneficiaries of each sub-pool are those clients:(a) from whom the firm has received a signed sub-pool disclosure document in accordance with CASS 7.19.11 R;(b) for whom the firm maintains, previously maintained or is in the process of establishing a margined transaction(s) in the relevant net margined omnibus client account at the authorised central
The records maintained under this section, including the sub-pool disclosure documents, are a record of the firm that must be kept in a durable medium for at least five years following the date on which client money was last held by the firm for a sub-pool to which those records or the sub-pool disclosure document applied.
Subject to CASS 7.16.25 R and CASS 7.16.37 R, under this method the client money requirement must be calculated by taking the sum of, for all clients and across all products and accounts: (1) the individual client balances calculated under CASS 7.16.21 R, excluding:(a) individual client balances which are negative (ie, debtors); and(b) clients' equity balances;(2) the total margined transaction requirement (calculated under CASS 7.16.32 R); and(3) any amounts that have been segregated
(1) A firm which utilises the net negative add-back method may1 calculate its client money requirement and client money resource on a bank account by bank account basis;(2) For1 the purposes of CASS 7.16.17 R, a firm should take into account any amounts that have been segregated as client money according to the firm's records under either or both CASS 7.13.50 R (prudent segregation record) and CASS 7.13.66 R (alternative approach mandatory prudent segregation record).
- (1)
A firm may calculate either:
- (a)
one individual client balance for each client,1 based on the total of the firm's holdings for that1client; or
- (b)
a number of individual client balances for each client, equal to the number of products or business lines the firm operates for that client and each balance based on the total of the firm's holdings for that client in respect of the particular product or business line.1
- (a)
- (2)
Each individual client balance for a client should be calculated in accordance with this table:
Individual client balance calculation
Free money (sums held for a client free of sale or purchase (eg, see (3)(a)) and
A
sale proceeds due to the client:
(a)
for principal deals when the client has delivered the designated investments; and
B
(b)
for agency deals, when:
(i)
the sale proceeds have been received by the firm and the client has delivered the designated investments; or
C1
(ii)
the firm holds the designated investments for the client; and
C2
the cost of purchases:
(c)
for principal deals, paid for by the client when the firm has not delivered the designated investments to the client; and
D
(d)
(i)
the firm has not remitted the money to, or to the order of, the counterparty; or
E1
(ii)
the designated investments have been received by the firm but have not been delivered to the client;
E2
Less
money owed by the client for unpaid purchases by, or for, the client if delivery of those designated investments has been made to the client; and
F
proceeds remitted to the client for sales transactions by, or for, the client if the client has not delivered the designated investments.
G
Individual client balance 'X' = (A+B+C1+C2+D+E1+E2)-F-G
X
- (3)
When calculating an individual client balance for each client, a firm should also:
- (a)
ensure it includes:
- (i)
client money consisting of dividends received and interest earned and allocated (see CASS 7.11.32 R);
- (ii)
client money consisting of dividends (actual or payments in lieu), stock lending fees and other payments received and allocated (see CASS 6.1.2 G);
- (iii)
money the firm appropriates and segregates as client money to cover an unresolved shortfall in safe custody assets it identifies in its internal records which is attributable to an individual client (see CASS 6.6.54R (2)); and
- (iv)
money the firm segregates as client money instead of an individual client's safe custody asset until such time as the relevant delivery versus payment transaction settles under CASS 6.1.12R (2); and
- (i)
- (b)
deduct any amounts due and payable by the client to the firm (see CASS 7.11.25 R).
- (a)
- (4)
Compliance with (1), (2) and (3)1 may be relied on as tending to establish compliance with CASS 7.16.21 R.
When calculating the client money requirement under either of the methods in CASS 7.16.10 R, a firm must:(1) include any unallocated client money (see CASS 7.13.36 R) and unidentified receipts of money it considers prudent to segregate as client money (see CASS 7.13.37 R);(2) include any money the firm appropriates and holds as client money to cover an unresolved shortfall in safe custody assets identified in its internal records which is not attributable, or cannot be attributed
An internal client money reconciliation should:(1) be one of the steps a firm takes to arrange adequate protection for clients' assets when the firm is responsible for them (see Principle 10 (Clients' assets), as it relates to client money);(2) be one of the steps a firm takes to satisfy its obligations under CASS 7.12.2 R and CASS 7.15.3 R and, where relevant, SYSC 4.1.1R (1) and SYSC 6.1.1 R, to ensure the accuracy of the firm's records and accounts;(3) for the normal approach
(1) Before using a non-standard method of internal client money reconciliation, a firm must:(a) establish and document in writing its reasons for concluding that the method of internal client money reconciliation it proposes to use will:(i) (for the normal approach to segregating client money) check whether the amount of client money recorded in the firm's records as being segregated in client bank accounts meets the firm's obligation to its clients under the client money rules
A firm must inform the FCA in writing without delay if: (1) its internal records and accounts of client money are materially out of date, inaccurate or invalid so that the firm is no longer able to comply with the requirements in CASS 7.15.2 R, CASS 7.15.3 R or CASS 7.15.5 R (1);(2) it will be unable to, or materially fails to, pay any shortfall into a client bank account or withdraw any excess from a client bank account so that the firm is unable to comply with CASS 7.15.29 R
(1) A firm must, as often as is necessary to ensure
the accuracy of its records and at least at intervals of not more than 25 business days:2(a) check whether its client money resource, as determined by CASS 5.5.65 R on the previous business day,
was at least equal to the client money requirement,
as determined by CASS 5.5.66 R or CASS 5.5.68 R, as at the close of
business on that day; and2(b) ensure that:2(i) any shortfall is
paid into a client bank account by
the close of business
(1) A trustee firm to which CASS 7.10.34 R applies may, in addition to the client money rules set out at CASS 7.10.34 R, also elect to comply with:(a) all the client money rules in CASS 7.13 (Segregation of client money); (b) CASS 7.14 (Client money held by a third party);(c) all the client money rules in CASS 7.15 (Records, accounts and reconciliations); or(d) CASS 7.18 (Acknowledgement letters).(2) A trustee firm must make a written record of any election it makes under this
(1) A trustee firm to which CASS 7.10.34 R applies may elect that: (a) the applicable provisions of CASS 7.13 (Segregation of client money) and CASS 7.15 (Records, accounts and reconciliations) under CASS 7.10.34 R; and(b) 2any further provisions it elects to comply with under CASS 7.10.35 R (1);will apply separately and concurrently for each distinct trust that the trustee firm acts for.(2) A trustee firm must make a written record of any election it makes under this rule, including
When a firm notifies a client under CASS 7.11.9 R (3)(a) of when the termination of an arrangement relating to the transfer of full ownership of the client's money to the firm is to take effect, it should take into account:(1) any relevant terms relating to such a termination that have been agreed with the client; and(2) the period of time it reasonably requires to return the money to the client, or to update its records under CASS 7.15 (Records, accounts and reconciliations)
A firm to which CASS 7.11.12 R applies should, for example, update its records under CASS 7.15 (Records, accounts and reconciliations) and segregate the money as client money under CASS 7.13 (Segregation of client money), from the relevant time at which the firm is required to treat the money as client money.
Firms are reminded that, notwithstanding that money may be due and payable to them, they have a continuing obligation to segregate client money in accordance with the client money rules. In particular, in accordance with CASS 7.15.2 R, firms must ensure the accuracy of their records and accounts and are reminded of the requirement to carry out internal client money reconciliations either in accordance with the standard methods of internal client money reconciliation or the requirements
(1) This rule applies where a firm identifies a discrepancy as a result of, or that reveals, a shortfall, which the firm has not yet resolved.(2) Subject to (3), until the discrepancy is resolved a firm must do one of the following:(a) appropriate a sufficient number of its own applicable assets to cover the value of the shortfall and hold them for the relevant clients under the custody rules in such a way that the applicable assets, or the proceeds of their liquidation, will
(1) A CASS debt management firm must allocate in its books and records any client money it receives to an individual client promptly and, in any case, no later than five business days following the receipt. (2) Pending a CASS debt management firm's allocation of a client money receipt to an individual client under (1), it must record the received client money in its books and records as "unallocated client money".
(1) Subject to (2) and CASS 6.1.12B R and with the written agreement of the relevant client, a9firm need not treat this chapter as applying in respect of a delivery versus payment transaction through a commercial settlement system if:9929(a) in respect of a client's purchase, the firm intends for the asset in question to be due to the client within one business day following the client's fulfilment of its payment obligation to the firm;9 or9(b) in respect of a client's sale, the
Subject to CASS 11.1.6 R, only the rules and guidance in the debt management client money chapter listed in the table below apply to CASS small debt management firms.
Reference |
Rule |
Application |
|
Firm classification |
|
Responsibility for CASS operational oversight |
|
Definition of client money and discharge of fiduciary duty |
|
Organisational requirements |
|
Statutory trust |
|
Selecting an approved bank at which to hold client money |
|
Client bank account acknowledgement letters |
|
Segregation and the operation of client money accounts |
|
Payments to creditors |
|
CASS 11.11.1 R to CASS 11.11.12 R , CASS 11.11.30 R and CASS 11.11.32 G |
Records, accounts and reconciliations |
CASS 11 resolution pack |
|
Client money distribution in the event of a failure of a firm or approved bank |