Cass Rules

When a financial service provider owns or controls client funds or assets, it must follow the rules outlined in the FCA`s Client Asset Directory (CASS). This guide from DeltaNet International explains what CASS is, how companies are classified, and how they can comply with relevant regulations. CASS has many registration requirements that are listed everywhere. In the case of a Cross-Border Searching Authority or an OSA, an insolvency administrator may require a complete reconciliation of the books and records relating to all deposit accounts prior to the release of the securities of those accounts. We are subject to the Client Assets Rules of the UK`s Financial Conduct Authority (CASS), which contain strict and detailed requirements to maintain correct books and records and compare our records with those of the CSDs where the accounts are held. Protecting client funds plays an important role in helping the FCA achieve its objectives. For example, CASS protects consumers` assets and money when a business breaks down, showing how it ensures an adequate level of protection for consumers. The source book also improves the integrity of the financial system by giving participants confidence that their money is protected. Finally, the Cass Rules establish a minimum standard of protection that allows for a competitive market for investment and custody services. Smarsh, Inc. assumes no responsibility for the accuracy or completeness of this information. Please contact a lawyer for specific information about the specific rules and regulations and how they apply to your business.

The collapse of the financial company Lehman Brothers is a prime example of the terrible consequences of non-compliance with regulations on customers` money and wealth. Lehman Brothers was heavily involved in the mortgage market and until 2008, the bank held thirty times more real estate products than capital. However, the company had borrowed far too much money to finance its mortgage investments. When the market turned around, Lehman couldn`t sell so many risky, low-rated mortgages. In the first half of 2008, the company lost 73% of its value. Of course, investors withdrew from them because they lost confidence in their integrity and competence. The collapse of Lehman Brothers changed the financial sector in the United States, which had global implications. Stock markets collapsed and debt soared. LCH is not subject to the Financial Conduct Authority`s Client Assets and Funds Rules (the "CASS Rules"). The FCA`s Client Assets Sourcebook (CASS) contains rules that companies must follow when holding or controlling client funds or custodial assets. CASS helps ensure the safety of clients` funds and assets when a company goes bankrupt and leaves the market. With regard to insurance, intermediation companies must follow the rules of CASS 5.

In this case, the customer`s money includes premiums received from customers until payment to the insurer, as well as claims and refunds of premiums that must be refunded to customers. The CASS rules apply to all types of businesses listed above. However, the main difference is that if you are a small CASS business, you are NOT required to complete a CMAR, NOR to make a director or senior executive responsible for CASS. CASS Medium and large companies are required to do both. You must follow the rules set out in the Client Asset Directory (CASS) when you hold or control client holding funds or custody assets in the course of your business. .