INMA 6.1.10 Systems and controls in relation to custody investments
(1) An INMA firm that holds or controls custody investments must have systems and controls:
(a) to ensure that those investments are properly safeguarded;
(b) to ensure that those investments are identifiable and secure at all times; and
(c) to demonstrate to its auditors and the Regulatory Authority that it complies with this Chapter.
(2) An INMA firm that provides custody services must ensure that custody investments are recorded, registered and held appropriately to safeguard and control them.
(3) Except as permitted in these rules or as required by law, an INMA firm that provides custody services must record, register and hold custody investments separately from its own assets.
(4) To the extent practicable, an INMA firm must appropriately register or record legal title to a custody investment in the name of:
(a) the customer concerned;
(b) a nominee controlled by the firm, if the customer's beneficial entitlement to the investment is properly recorded in the nominee's records;
(c) a nominee controlled by an eligible custodian;
(d) an eligible custodian, if:
(i) the investment is subject to the law or market practice of a jurisdiction outside the QFC, and the firm has taken reasonable steps to determine either that it is in the customer's best interests to register or record it in that way, or that (because of that law or market practice) it is not feasible to do otherwise; and
(ii) the firm has notified the customer in writing;
(e) the firm, if:
(i) the firm has determined on reasonable grounds, having regard to the law and market practice to which the investment is subject, either that it is in the customer's best interests for the investment to be registered or recorded in the name of the firm or that it is not feasible to do otherwise; and
(ii) the firm has notified the customer in accordance with rule 6.1.18(1)(i); or
(f) any other person, in accordance with the customer's specific written instruction, if the firm has notified the customer in accordance with rule 6.1.18(1)(j).
|Derived from QFCRA RM/2014-4 (as from 1st January 2015).|