Client Assets: Financial Services

A tracker providing details of final notices issued by the FCA and FSA concerning breaches of rules relating to the holding of client assets and client money, which are set out in the Client Assets sourcebook (CASS).

An outline of the FCA's client money requirements that are set out in chapter 7 of the Client Assets sourcebook (CASS 7). The note explains what client money is and the creation of the client money trust. It also covers the requirements relating to identification and segregation of client money, and those relating to client money bank accounts and the daily reconciliation of client money.

An outline of the changes made to FSA's Client Assets sourcebook (CASS), which took effect (subject to one exception) from 1 January 2009. FSA consulted on these changes in consultation paper 08/6, Review of the client assets sourcebook (CP08/6). The final rules and feedback to the consultation are set out in policy statement 08/10, Client assets sourcebook (Common platform provisions) instrument 2008 (PS08/10). FSA adopted a principles-based approach to its review, with the removal of unnecessary guidance and, as far as possible, introducing a single regime for client assets based on (but not limited entirely to) MiFID requirements. In doing so, FSA sought to reduce any significant undue burdens on firms. The recent financial crisis and the collapse of Lehman Brothers have revealed a number of serious failings in relation to firms' handling of client money and assets, and weaknesses in the FSA's current client assets regime. As a result, client assets is now one of the FSA's key supervisory priorities, and a number of initiatives are being undertaken by HM Treasury and the FSA to address these issues. For information on these developments, see Practice note, FSA reform of client assets regime (2008-11): thematic work and rules changes.

An overview of HM Treasury's review of resolution arrangements for investment banks and firms. The review, which was carried out under powers granted in the Banking Act 2009, resulted in the introduction, in February 2011, of a special administration regime (SAR) for investment banks and firms.

This practice note outlines the European Commission's legislative proposals to amend the Markets in Financial Instruments Directive (2004/39/EC), which were published on 20 October 2011 (MiFID II). For a summary of, and links to, PLC Financial Services MiFID materials, see Practice note, A guide to PLC Financial Services MiFID materials.

This practice note is one of two notes summarising the European Commission's consultation proposals to amend the requirements of the Markets in Financial Instruments Directive (2004/39/EC) and its implementing legislation, which were published in December 2010 following the Commission's review of the effectiveness of the Directive. This note focuses specifically on the proposals relating to the scope of MiFID (including exemptions), conduct of business issues, the provision of investment services (including authorisation and organisational requirements), the sanctions regime, member state options and discretions, and third country firm equivalence. This note does not comment on the Commission's legislative proposals to amend MiFID, which were published in October 2011. For details of the legislative proposals, see Practice note, Hot topics: MiFID II.

A discussion of the elements of the regulated activity of safeguarding and administering investments, and the applicable exclusions and exemptions.