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18th May 2015

Client Money Rules: CASS Rulebook Changes

Last June (2014) the FCA published a Policy Statement for investment firms holding client money and client assets. The extensive and detailed changes included a rewrite of the FCA’s Client Money Rules and substantial amendments to the CASS Sourcebook.

Policy Statement 14/09 announced a wide range of changes including but not limited to:

The changes to the Client Money Rules are to have been implemented in three stages with the last of these effective 1st June 2015, next month, with the previous two stages having been implemented from 1st July 2014 and 1st December 2014.

The following table sets out a high-level summary of key changes to the CASS Rules which those affected will need to address by the start of next month.

High-level summary of key changes to FCA CASS Rules:


CASS Rule Implementation: Stage 3 - Effective 1st June 2015

Client Money Rules Update

Policy topic

Date of commencement

Registration of firm and custody assets

01-Jun-15

Depositing assets when using third party custody services

01-Jun-15

Custody recordkeeping, record checks and reconciliations

01-Jun-15

TTCA – procedure for switching

01-Jun-15

DvP window – regulated collective investment scheme

01-Jun-15

Client bank accounts – due diligence and diversification

01-Jun-15

Immediate segregation

01-Jun-15

Physical receipts and allocation of client money

01-Jun-15

Cleared funds

01-Jun-15

Money due to client from firm

01-Jun-15

Prudent segregation

01-Jun-15

Client money relating to custody assets held at a custodian

01-Jun-15

Client money recordkeeping and reconciliations

01-Jun-15

Further consequential changes to the client money distribution rules

01-Jun-15

Non-written mandates

01-Jun-15

Reporting to clients

01-Jun-15

Consequential change to the CMAR and CASS RP

01-Jun-15