Regulatory Alerts2017-04-16
Proposed Module CL Defined Terms for Conventional Bank Licensees' Client Money Module
The regulator proposes adding defined terms to the glossary of Volume 1 for conventional bank licensees. These amendments establish precise meanings for "client", "Designated Bank", and "Eligible Third Party" to support the Client Assets module. By clarifying these relationships, the rules ensure that client funds are properly consented to and held through approved exchanges, clearing houses, or intermediate brokers.
Defined Terms to be added to the Glossary of Volume 1 “Conventional Bank Licensees” – Part of developing Client Money Module. Client For the purpose of “Client Assets” module for conventional bank licensees, “client” refers to a person (natural or corporate) or groups of persons who have a business relationship with the bank. Designated Bank A designated bank is one to which the client of the conventional bank licensee has consented in writing to hold his money. See Section CL-4.2. Eligible Third Party An eligible third party refers to: (a) An exchange; (b) A clearing house; or (c) An intermediate broker.