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CASS 8.2 Definition of mandate

CASS 8.2.1R

1A mandate is any means that give a firm the ability to control a client's assets or liabilities, which meet the conditions in (1) to (5):

  1. (1)

    they are obtained by the firm from the client, and with the client's consent;

  2. (2)

    where those means are obtained in the course of, or in connection with, the firm's insurance mediation activity, they are in written form at the time they are obtained from the client;

  3. (3)

    they are retained by the firm;

  4. (4)

    they put the firm in a position where it is able to give any or all of the types of instructions described in (a) to (d):

    1. (a)

      instructions to another person in relation to the client's money that is credited to an account maintained by that other person for the client;

    2. (b)

      instructions to another person in relation to any money to which the client has an entitlement, where that other person is responsible to the client for that entitlement (including where that other person is holding client money for the client in accordance with CASS 5 or CASS 7);

    3. (c)

      instructions to another person in relation to an asset of the client, where that other person is responsible to the client for holding that asset (including where that other person is safeguarding and administering investments, acting as trustee or depositary of an AIF or acting as trustee or depositary of a UCITS);2

    4. (d)

      instructions to another person such that the client incurs a debt or other liability to that other person or any other person (other than the firm); and

  5. (5)

    their circumstances are such that the client's further involvement would not be necessary for the firm's instructions described in 4(a) to 4(d) to be given effect.

The form of a mandate3

CASS 8.2.2G

A mandate can take any form and need not state that it is a mandate. For example it could take the form of:3

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  1. (1)

    a standalone document containing certain information conferring authority to control a client's assets or liabilities on the firm;3

  2. (2)

    a specific provision within a document or agreement that also relates to other matters; or3

  3. (3)

    an authority provided by a client orally.3

Retention by the firm

CASS 8.2.3G
  1. (1)

    If a firm receives information that puts it in the position described in CASS 8.2.1 R (4) in order to effect transactions immediately on receiving that information, then such information could only amount to a mandate if the firm retained3it (for example by not destroying the relevant document, electronic record or telephone recording3):

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    1. (a)

      after it uses it to effect those immediate transactions; or

    2. (b)

      because those transactions are not, for whatever reason, effected immediately.

  2. (2)

    If a firm receives information that puts it in the position described in CASS 8.2.1 R (4) and the firm retains that information (for example in accordance with its record-keeping procedures or in order to effect transactions in the future or over a period of time) then such information could amount to a mandate.

Ability to give instructions to another person

CASS 8.2.4G

The instructions referred to at CASS 8.2.1 R (4) are all instructions given by a firm to another person who also has a relationship with the firm's client. For example, the other person may be the client's bank, intermediary, custodian or credit card provider. This means, for example, that any means by which a firm can control a client's money or assets for which it is itself responsible to the client (rather than any other person) would not amount to a mandate. This includes where the firm is holding a client's money or assets other than in accordance with CASS 5, CASS 6 or CASS 7 (for example, because of an exemption in those rules).

CASS 8.2.5G

A mandate in relation to the type of instructions referred to in CASS 8.2.1R (4)(a) could include a direct debit instruction over a client's bank account in favour of the firm. The fact that the instruction was given by the client in the form of a paperless direct debit would not prevent it from being a mandate.3

CASS 8.2.6G

A mandate in relation to the type of instructions referred to in CASS 8.2.1 R (4)(d) could include the client's credit card details.

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Conditions on use of mandate and client’s further involvement

CASS 8.2.7G
  1. (1)

    If a firm obtains the means by which it can give the types of instructions referred to in CASS 8.2.1 R (4), but its use of those means is subject to any limits or conditions, then this does not necessarily prevent those means from being a mandate. For example, a client might require that a firm uses a mandate only in connection with transactions up to a certain value.

  2. (2)

    However, if a firm obtains the means by which it can give the types of instructions referred to in CASS 8.2.1 R (4), but the firm cannot, in practice, use those means without the client's further involvement, then the condition in CASS 8.2.1 R (5) would not be met. For example, a firm might have the means by which it can give instructions of the type referred to in CASS 8.2.1 R (4)(a) in relation to an account maintained by another person for a client, but that other person might require the client's signature or other authorisation before it gives effect to those instructions.