Regulatory Alerts2011-02-22
Added · Updated
Personal injury firms and the prohibition under Section 3:5 of the Wft
The prohibition under Section 3:5 of the Financial Supervision Act (Wft) generally does not apply to personal injury firms because payments received from insurers do not constitute repayable funds. Insurers are discharged from their payment obligations upon transfer, meaning the funds are not held for repayment to the payer. An exception exists only if the insurer retains the right to claim repayment before the personal injury firm passes the funds to the injured party. In such cases, the prohibition applies unless the payer is an insurer, which is exempt as a professional market party.
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