Client money and assets: top tips for firms

The FCA’s Client assets sourcebook (CASS) is among the most demanding and consequential for financial services firms. Only so much regulatory responsibility can be outsourced in this area and firms will need in-house expertise
by Paul Bryant

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The FCA’s Client Assets sourcebook (CASS) guides and regulates FCA registered firms that hold or control client money or custody assets (such as company shares or bonds). Primarily, the sourcebook is to ensure that client assets can be quickly and accurately returned to clients if the firm fails, but also to ensure they are adequately protected against risks, such as fraud or theft.

Many CISI members will fall into the ambit of this regulation. According to Karen Bond, Chartered MCSI, director at Walbrook Partners, a CASS regulatory support consultancy and training provider: “CASS is unique in that it is so prescriptive in terms of the actions required, such as spelling out exactly how client money needs to be segregated. It is also demanding in terms of breach reporting. The FCA is quite ‘interventionist’ (site visits are fairly common) and very detailed in its approach and the fines for breaches can be huge.” On top of this, she says, consultants and auditors can differ quite a lot in their opinions of what is and isn’t adequate. So, says Karen, firms need to build a deep understanding of CASS in-house.

 

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Published: 01 May 2020
Categories:
  • Wealth Management
  • Operations
  • Compliance, Regulation & Risk
Tags:
  • featured
  • Beaufort Securities
  • Resolution pack
  • Lehman Brothers
  • CMAR
  • Client assets
  • CASS
  • breaches

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