CASS 15 Annex 1 Safeguarding account acknowledgement letter template

[Letterhead of safeguarding institution, including full name and address of safeguarding institution]

[name and address of approved bank or authorised custodian]

[date]

Safeguarding Account Acknowledgement Letter (pursuant to the rules of the Financial Conduct Authority)

We refer to the following [account[s]] which [name of safeguarding institution], regulated by the Financial Conduct Authority (Firm Reference Number [FRN]), (‘us’, ‘we’ or ‘our’) [has opened or will open] [and/or] [has deposited or will deposit] with [name of approved bank or authorised custodian] (‘you’ or ‘your’):

[insert the account title[s], the account unique identifier[s] (eg, sort code and account number, deposit number or reference code) and (if applicable) any abbreviated name of the account[s] as reflected in the firm’s systems]

([collectively,] the ‘Safeguarding Account[s]’).

For [each of] the Safeguarding Account[s] identified above you acknowledge that we have notified you that:

(1)

we are under an obligation to keep [money] [or] [assets] we hold to meet the claims of our clients separate from other [money] [or] [assets];

(2)

we have opened, or will open, the Safeguarding Account for the purpose of depositing [money] [or] [assets] with you to meet the claims of our clients; and

(3)

we hold all [money] [or] [assets] standing to the credit of the Safeguarding Account to meet the claims of our clients.

For [each of] the Safeguarding Account[s] above you agree that:

(4)

you do not have any interest in, or recourse or right against [money] [or] [assets] in the Safeguarding Account in respect of any sum owed to you, or owed to any third party, on any other account (including an account we use for our own [money] [or] [assets]) except as permitted by [regulation 24(1) of the Electronic Money Regulations 2011] [or] [regulation 23(14) of the Payment Services Regulations 2017]. This means, for example, that you do not have any right to combine the Safeguarding Account[s] with any other account and any right of set-off or counterclaim against [money/assets] in the Safeguarding Account, except following an insolvency event (as defined in [regulation 22 of the Electronic Money Regulations 2011] [or] [regulation 23 of the Payment Services Regulations]), and:

(a) to the extent that the right of set-off or counterclaim relates to your fees and expenses in relation to the operation of the Safeguarding Account; or

(b) if all the claims of our clients have been paid;

(5)

you will title, or have titled, the Safeguarding Account as stated above and that this title is different to the title of any other account containing [money] [or] [assets] belonging to us or to any third party; and 

(6)

you are required to release on demand all [money] [or] [assets] standing to the credit of the Safeguarding Account upon proper notice and instruction from us or a liquidator, receiver, administrator, or trustee (or similar person) appointed for us in bankruptcy (or similar procedure), in any relevant jurisdiction, except:

(a) to the extent that you are exercising a right of set-off or security right as permitted by [regulation 24(1) of the Electronic Money Regulations 2011] [or] [regulation 23(14) of the Payment Services Regulations 2017]; or

(b) until the fixed term expires, any amounts held under a fixed term deposit arrangement which cannot be terminated before the expiry of the fixed term,

provided that you have a contractual right to retain such [money] [or] [assets] under (a) or (b) and that this right is notwithstanding paragraphs (1) to (3) above and without breach of your agreement to paragraph (4) above.

We acknowledge that:

(7)

you are not responsible for ensuring compliance by us with our own obligations in respect of the Safeguarding Account[s].

You and we agree that:

(8)

the terms of this letter will remain binding upon the parties, their successors and assigns, and, for clarity, regardless of any change in any of the parties’ names;

(9)

this letter supersedes and replaces any previous agreement between the parties in connection with the Safeguarding Account[s], to the extent that such previous agreement is inconsistent with this letter;

(10)

if there is any conflict between this letter and any other agreement between the parties over the Safeguarding Account[s], this letter will prevail;

(11)

no variation to the terms of this letter shall be effective unless it is in writing, signed by the parties and permitted under the rules of the Financial Conduct Authority;

(12)

this letter is governed by the laws of [insert appropriate jurisdiction] [safeguarding institutions may optionally use this space to insert additional wording to record an intention to exclude any rules of private international law that could lead to the application of the substantive law of another jurisdiction]; and

(13)

the courts of [insert same jurisdiction as previous] have non-exclusive jurisdiction to settle any dispute or claim from or in connection with this letter or its subject matter or formation (including non-contractual disputes or claims).

Please sign and return the enclosed copy of this letter as soon as possible. 

For and on behalf of [name of safeguarding institution]

x___________________________

Authorised Signatory

Print Name:

Title:

ACKNOWLEDGED AND AGREED:

For and on behalf of [name of bank/custodian]

x___________________________

Authorised Signatory

Print Name:

Title:

Contact Information: [insert signatory’s phone number and email address]

Date: