Related provisions for CASS 5.6.4
1 - 10 of 10 items.
A firm may open one or more client bank accounts in the form of a general client bank account, a designated client bank account or a designated client fund account (see CASS 7A.2.1 G (Failure of the authorised firm: primary pooling event)). The requirements of CASS 7.13.13 R (2) and CASS 7.13.13 R (3) apply for each type of client bank account.
(1) 7Subject to paragraph (2), CASS 7.13.41R to CASS 7.13.49R do not apply to a firm following a primary pooling event.(2) If, at the time of a primary pooling event, a firm has retained money in a client bank account for the purposes of CASS 7.13.41R, that money remains client money for the purposes of the client money rules and the client money distribution and transfer rules.
(1) 7Subject to paragraphs (2) and (3), CASS 7.13.59R, CASS 7.13.62R(3), CASS 7.13.62R(4) and CASS 7.13.63R to CASS 7.13.67R do not apply to a firm following its failure.(2) If, at the time of a primary pooling event, a firm has retained money in a client bank account for the purposes of alternative approach mandatory prudent segregation under CASS 7.13.65R, that money remains client money for the purposes of the client money rules and the client money distribution and transfer
(1) 7Subject to paragraphs (2) and (3), CASS 7.13.73R to CASS 7.13.75R do not apply to a firm following a primary pooling event.(2) If, at the time of a primary pooling event, a firm has retained money in a client bank account for the purposes of clearing arrangement mandatory prudent segregation under CASS 7.13.73R, that money remains client money for the purposes of the client money rules and the client money distribution and transfer rules.(3) Where a firm holds a clearing
(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 and transfer rules7.
If a primary
pooling event occurs:(1) client money held in each client
money account of the firm is
treated as pooled;(2) the firm must distribute that client
money in accordance with CASS 5.3.2 R or,
as appropriate, CASS 5.4.7 R, so that each client receives
a sum which is rateable to the client money entitlement
calculated in accordance with CASS 5.5.66 R; and(3) the firm must, as trustee, call in and make demand
in respect of any debt due to the firm as
trustee, and must liquidate
Client
money received by the firm (including
in its capacity as trustee under CASS
5.4 (Non-statutory trust)) after
a primary pooling event must
not be pooled with client money held
in any client money account
operated by the firm at the
time of the primary pooling event.
It must be placed in a client bank account that
has been opened after that event and must be handled in accordance with the client money rules, and returned to the relevant client without delay, except to the
If a firm receives
a mixed remittance after a primary pooling event, it must:(1) pay
the full sum into the separate client bank
account opened in accordance with CASS 5.6.9 R;
and (2) pay
the money that is not client money out of that client
bank account into the firm's own
bank account within one business day of
the day on which the remittance
is cleared.
(1) 7If a special administrator has been appointed to the firm under the IBSA Regulations then they will be required to carry out a reconciliation under regulation 10H of the IBSA Regulations. (2) Notwithstanding regulation 10H of the IBSA Regulations, CASS 7.15 has application to a firm after a primary pooling event, meaning, for example, that ongoing compliant record-keeping is required (see CASS 7.15.15R(4) (Internal client money reconciliations) and CASS 7.15.26AR (Frequency
If a primary pooling event occurs, then4:(1) (a) in respect of a sub-pool,4 the following is treated as a single notional pool of client money for the beneficiaries of that pool:45(i) any client money held in a client bank account of the firm relating to that sub-pool; and5(ii) any client money held in a client transaction account of the firm relating to that sub-pool, except for client money held in a client transaction account at an authorised central counterparty3 or a clearing
(-2) (a) Subject to paragraph (-2)(b), each client’s entitlement to client money in a notional pool is calculated with reference to the client money requirement as shown by an internal client money reconciliation carried out in accordance with CASS 7.15.15R(4)(a) (Internal client money reconciliations) as at the primary pooling event.7(b) If, as at the primary pooling event, the firm had entered in to one or more cleared margined transactions through the use of a client transaction
(1) 7Before a firm ceases to treat a balance of client money in a notional pool as client money by transferring it to itself under CASS 7.17.2R(5) it must:(a) (subject to paragraph (2)) attempt to distribute the balance to the relevant client or transfer it to another person for safekeeping on behalf of the client in accordance with CASS 7A.2.4R (Pooling and distribution or transfer); (b) (subject to paragraph (3)) take reasonable steps to notify any client in respect of whom
(1) 7Reasonable steps in CASS 7A.2.6AR(1)(b) include the following course of conduct:(a) determining, as far as reasonably possible, the correct contact details for the relevant client;(b) for a client for whom the firm has evidence that it was a professional client for the purposes of the client money rules at the time of the primary pooling event:(i) writing to the client at the last known address either by post or by electronic mail:(A) to inform it of the firm’s intention
If a firm receives a mixed remittance after a primary pooling event other than where using the alternative approach under CASS 7.13.62R or under a regulated clearing arrangement to which CASS 7.13.72R applies7, it must:(1) pay the full sum into a client bank account that meets the requirements of CASS 7A.2.7-AR(2)7; and(2) pay the money that is not client money out of that client bank account into a firm's own bank account within one business day of the day on which the firm would
(1) 3The reference point for the internal client money reconciliation under CASS 7.15.15R(4)(a) should be the precise point in time at which the primary pooling event occurred.(2) When a firm decides whether it is necessary at any particular point in time to perform an internal client money reconciliation under CASS 7.15.15R(4)(b), it should have particular regard to the need to maintain its books and accounts in order to ensure that:(a) each notional pool of client money formed
3When determining the frequency with which it will undertake external client money reconciliations under CASS 7.15.26AR(2) after a primary pooling event, a firm must have regard to:(1) the frequency, number and value of transactions which the firm undertakes in respect of client money; (2) the risks to which the client money is exposed, such as the nature, volume and complexity of the firm’s business and where and with whom client money is held; and(3) the need to be able to verify
A firm can
hold client money in either
a general client bank account (CASS 5.5.38 R) or a designated client bank account (CASS 5.5.39 R). A firm holds all client money in general
client bank accounts for its clients as
part of a common pool of money so
those particular clients do
not have a claim against a specific sum in a specific account; they only have
a claim to the client money in
general. A firm holds client money in designated
client bank accounts for those clients who
requested
A firm may
open one or more client bank accounts in
the form of a designated client bank account.
Characteristics of these accounts are that:(1) the
account holds money of one or
more clients;(2) the
account includes in its title the word 'designated';(3) the clients whose money is
in the account have each consented in writing to the use of the bank with
which the client money is to
be held; and(4) in
the event of the failure of
that bank, the account is not pooled with any other
2As a result of CASS 7A.1.1A R, the client money distribution and transfer rules4 relating to primary pooling events and secondary pooling events will not affect any client money held by a firm in its capacity as trustee firm. Instead, the treatment of that client money will be determined by the terms of the relevant instrument of trust or by applicable law. However, the client money distribution and transfer rules4 do apply to a firm for any client money that it holds other