INMA 6.1.14 Acknowledgement by eligible custodian

Before an INMA firm permits custody investments to be held by an eligible custodian or a nominee controlled by an eligible custodian, the firm must obtain a written acknowledgement from the custodian stating:

(a) that the title of the account in which the investments will be held sufficiently distinguishes it from any other account containing assets that beneficially belong to the firm or its nominee, and is in the form requested by the firm;
(b) that investments will be credited to, and withdrawn from, the account only in accordance with the firm’s instructions;
(c) that the custodian will hold or record the investments separately from assets belonging to the custodian and will ensure that any sub-custodian that it uses does the same;
(d) that the custodian will use due skill, care and diligence in the selection of any sub-custodian that it uses;
(e) the arrangements for recording and registering the investments, claiming and receiving dividends and other entitlements and interest, and giving and receiving instructions;
(f) that the custodian will give a statement to the firm at stated intervals setting out the description and amounts of investments in the account;
(g) that the custodian is not entitled to combine the account with any other account, or to exercise any charge, mortgage, lien, right of set-off or counterclaim against investments in the account for any sum owed to it on any other account of the firm (except for any charges relating to the administration or safekeeping of the investments in the account); and
(h) the extent of the custodian’s liability in the event of the loss of an investment caused by the fraud, wilful default or negligence of the custodian or its agent.
Derived from QFCRA RM/2014-4 (as from 1st January 2015).