INMA 5.10.4 Firm-related distribution events — order of distribution
(1) After a firm-related distribution event in relation to an investment business firm (whether the firm is incorporated in the QFC or otherwise), the firm must distribute client money as set out in this rule.
(2) All client money held in a client bank account or third party account must be pooled and distributed:
(a) first, to pay the costs of distributing it in accordance with paragraph (b); and
(b) secondly, to customers for whom it is held, proportionately in accordance with the amount of their respective valid claims against the firm for client money.
(3) Any client money remaining in the firm’s client bank accounts and third party accounts after the satisfaction of all the claims referred to in subrule (2) must be distributed:
(a) if a liquidator, receiver, administrator, or trustee in bankruptcy has been appointed over the firm — in accordance with the applicable insolvency or bankruptcy laws; or
(b) in any other case — as the Regulatory Authority directs.
(4) If the amount of client money held in the firm’s client bank accounts and third party accounts is not enough to satisfy all its customers’ valid claims for client money, all the firm’s other beneficially-owned assets may be used to satisfy those claims in priority to all of the firm’s other creditors (other than creditors that have a prior ranking security interest in such assets).
|Derived from QFCRA RM/2014-4 (as from 1st January 2015).|