source stringclasses 1 value | url stringlengths 41 43 | title stringlengths 30 134 | section stringlengths 4 6 | content stringlengths 1.8k 273k | scraped_at stringdate 2025-11-15 10:14:35 2025-11-15 10:26:47 | content_type stringclasses 1 value | jurisdiction stringclasses 1 value | regulator stringclasses 1 value | files listlengths 0 0 | pii_removed_count int64 5 21 | quality_score float64 0.87 1 | readability_score float64 0.62 1 | word_count int64 284 44.2k |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
FCA Handbook | https://handbook.fca.org.uk/handbook/bcobs4 | FCA Handbook - BCOBS 4 Information to be communicated to banking customers | bcobs4 | Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve it by giving your feedback . Home Latest News Published Date This Month Submit Reset FC[ORG] Handbook Select Timeline Track Changes View Chapter as PDF View Sourcebook as PDF Glossary Select Timeline Track Changes Filter by provision Submit Reset Instruments Made by last board Instrument Type Effective Date Last 7 Days Last 15 Days Last 30 Days Last 90 Days Published Date Last 30 Days Last 90 Days Last Year Filter by Module Submit Reset Forms Type Effective Date Last 7 Days Last 30 Days Last 90 Days Last Year Submit Reset Technical Standards Select Timeline Track Changes Level 3 Materials Filter by Dossier Submit Reset Advanced Search User Guides Video Guides Reader's Guide Navigation Guide Useful Links Search Guide Timeline Guide FAQ Handbook Archive Submit Reset Administrator External Users [ORG] Users Role List [ORG]MS Latest News Stage FCA Handbook Stage FCA Glossary Stage Instruments Stage Forms Stage Level 3 Materials Stage Technical Standards Stage [ORG]A Website Useful Links Advanced Search Help [ORG] Handbook in print SignUp / SignIn [ORG] Website PRA Rulebook Useful Links Contact Us Advanced Search Search Clear Home FCA Handbook BCOBS BCOBS 4 BCOBS 4 Information to be communicated to banking customers You are viewing BCOBS 4 Information to be communicated to banking customers as of 15/11/2025 . BCOBS 4 Information to be communicated to banking customers was last updated on 01/08/2025 . Rules Guidance Taxonomy BCOBS 4.1 Enabling banking customers to make informed decisions The appropriate information rule [ORG]OBS 4.1.1 01/11/2009 R A firm must provide or make available to a banking customer appropriate information about a retail banking service and any deposit made in relation to that retail banking service : (1) in good time; (2) in an appropriate medium; and (3) in easily understandable language and in a clear and comprehensible form; so that the banking customer can make decisions on an informed basis. BCOBS 4.1.2 06/04/2017 G (1) In determining: (a) what is "in good time"; (b) the appropriate medium for communicating information; and (c) whether it is appropriate to provide information (that is, send or give it directly to the banking customer ) or make it available (that is, make it available to obtain at the banking customer's option); a firm should consider the importance of the information to the decision-making process of the banking customer and the time at which the information may be most useful. Distance communications requirements are also relevant. (2) For example, (unless BCOBS 3 applies) a firm should provide the terms and conditions of the contract for a retail banking service on paper or in another durable medium in good time before a banking customer is bound by them. (2A) (a) A firm should provide a summary box in the form set out in BCOBS 2 Annex 1R on paper or in another durable medium in good time before a banking customer is bound by the terms and conditions of a savings account , except where the firm has already provided the summary box to a banking customer on a previous occasion. (b) If the contract for the savings account has been concluded at a banking customer’s request using a means of distance communication that does not enable the provision of the summary box in that form in good time before the banking customer is bound, the firm should provide the summary box on paper or in another durable medium immediately after the conclusion of the contract. (c) In the case of a savings account that is a cash deposit ISA , cash-only lifetime ISA or a cash deposit CTF , the firm may include the summary box in a key features document provided to the banking customer in line with the rules and guidance in COBS 13 and COBS 14 . (d) In preparing the summary box, a firm should have regard to the provisions of BCOBS 2.2A.1R as if they were guidance . (2B) A firm should ensure that the rate of interest that applies to a savings account is prominently shown alongside, or in close proximity to (or, in the case of (b), on a page accessed directly through a link that appears prominently alongside or in close proximity to) any account balance information included in: (a) any paper or online statement of account provided or made available by the firm ; (b) where the firm provides an online banking service to the banking customer , the first personalised page of the firm’s website that the banking customer accesses when using this service; (c) any notification of a material change to a rate of interest provided in accordance with (3)(c); (d) any notification of the expiry of an introductory, promotional or preferential rate of interest provided in accordance with (5); and (e) any notification of the expiry of a fixed term of a fixed term savings account provided in accordance with (6A). (2C) For the purposes of (2B): (a) (i) unless (ii) applies, the firm should show the rate of interest that applies to the savings account as a numerical figure (and not merely the method for determining the current figure under the terms and conditions); (ii) where the rate of interest that applies to the savings account automatically tracks a reference interest rate (within the meaning of the Payment Services Regulations ), the firm should indicate how the rate of interest is calculated and direct the banking customer to where the level of the reference interest rate may be accessed from time to time; and (b) (i) in the case of account balance information made available online, the firm should show the rate of interest that applies to the account at the time the banking customer accesses the information; or (ii) in the case of account balance information provided in a durable medium , the firm should show the rate of interest that applies to the account at the time the information is sent. (2D) A firm should inform a banking customer of the current rate of interest that applies to a savings account on the telephone or in a branch of the firm at the request of the banking customer . (2E) A firm should publish the current rate of interest that applies to each savings account it provides on its website (whether or not the savings account is available to new customers) and ensure that this is kept continuously up to date and is easily accessible by a banking customer . (3) Where a firm proposes to exercise a power to make: (a) a change to any term or condition of the agreement; or (b) a change to any charge; or (c) a material change to any rate of interest; that applies to the retail banking service and that will be to the disadvantage of a banking customer , the firm should provide reasonable notice to the banking customer on paper or in another durable medium before the change takes effect, taking into account the period of notice required by the banking customer to terminate the contract for the retail banking service . A change to a rate of interest should always be considered ‘material’ except where the balance of the account is less than £100 at the time when the firm would provide the notice. (3A) When providing a notice under (3)(c), (5) or (6A), a firm should ensure that the heading of the notice clearly indicates the main substance of the change to which the notification relates. When providing a notice under (3)(c) relating to a decrease in the rate of interest, for example, a firm should ensure that the heading of the notice clearly indicates that the rate of interest is decreasing. (4) Where a firm notifies a banking customer of a material change to a rate of interest that applies to a retail banking service and that will be to the disadvantage of a banking customer , this notification should, where applicable: (a) refer to the fact that the firm offers a comparable retail banking service for which the banking customer is eligible; (b) indicate that the banking customer may move to that retail banking service or a retail banking service provided by another firm ; and (c) indicate that the firm will assist the banking customer to move to another retail banking service if he wishes to do so. (5) Subject to (5A), where, under a contract for a retail banking service , an introductory, promotional or preferential rate of interest applies to the retail banking service until a specified future date or the end of a fixed period, a firm should provide notice of the expiry of the application of that rate of interest to the banking customer on paper or in another durable medium within a reasonable period before that rate of interest ceases to apply. (5A) Paragraph (5) does not apply where the balance of the account is less than £100 at the time when the firm would otherwise provide the notice. (6) [deleted] (6A) In relation to a fixed-term savings account , a firm should provide notice of the expiry of the fixed term to the banking customer on paper or in another durable medium in good time before the end of the fixed term. This notice should explain, in easily understandable language and in a clear and comprehensible form: (a) the consequences of the expiry of the fixed term, including whether the firm proposes to transfer the balance of the account to another fixed-term savings account if the banking customer does not provide further instructions to the firm while the customer has an opportunity to do so; and (b) the options available to the banking customer for dealing with the balance in the fixed term savings account , including when and how these options may be exercised. (6B) Where a notice under (3)(c), (5) or (6A) is provided by the firm more than 14 days before the change to which the notice relates takes effect, a firm should also provide a reminder to the banking customer within a period beginning 14 days before the relevant change takes effect and ending on the day before it does so. The firm may choose the medium in which the reminder is provided. In doing so, the firm should take account of any preferences expressed by the banking customer about the medium of communication between the firm and the banking customer , for example, if the banking customer has indicated a preference to receive information by mobile telephone text message. (7) The general law, including the Unfair Terms Regulations (for contracts entered into before 1 October 2015) and the CRA , also limits the scope for a firm to use or rely on a variation clause in a contract with a consumer . BCOBS 4.1.3 01/11/2009 R Where a rule in this chapter requires information to be provided on paper or in another durable medium before a banking customer is bound by the terms and conditions of the contract, a firm may instead provide that information in accordance with the distance communication timing requirements (see BCOBS 3.1.11 R and BCOBS 3.1.12 R ). BCOBS 4.1.4 13/01/2018 G The appropriate information rule applies before a banking customer is bound by the terms of the contract. It also applies after a banking customer has become bound by them. In order to meet the requirements of the appropriate information rule , information provided or made available by a firm to a banking customer should include information relating to: (1) the firm ; (2) the different retail banking services offered by the firm which share the main features of the retail banking service the banking customer has enquired about, or which have the product features the banking customer has expressed an interest in, unless the banking customer has expressly indicated that he does not wish to receive that information; (3) the terms and conditions of the contract for a retail banking service and any changes to them; (4) the rate or rates of interest payable on any deposit, how and when such interest is calculated and applied and any changes to that rate or those rates; (5) any charges at any time payable by or on behalf of a banking customer in relation to each retail banking service and any changes to those charges; (5A) the time at which any funds placed with or transferred to the firm for credit to the banking customer's account will be made available to the banking customer ; (6) a banking customer's rights to cancel a contract for a retail banking service ; (7) how a banking customer may make a complaint (at the time and in the manner required by DISP 1.2 ); (8) [deleted] (9) basic bank accounts but only if the firm offers a basic bank account and the banking customer meets the firm's eligibility criteria for such an account; and (10) the timescales for each stage of the cheque clearing process. BCOBS 4.1.4A 01/04/2013 G (1) This guidance applies to a firm only with respect to its communications and dealings with consumers where a firm has a right of set-off . (2) To ensure compliance with the appropriate information rule , the firm should: (a) (i) provide an explanation of the nature and extent of the firm's right of set-off ; and (ii) if the firm considers that it is entitled to exercise a right to set off or combine a debt due solely from a consumer , or a debit balance on an account held in the sole name of a consumer , against or with a credit balance on an account held in the joint names of that consumer and another consumer , also provide an explanation of that right to the consumers in whose names the joint account is held; in good time before the consumer is bound by the contract for the retail banking service . This information may be incorporated in the terms and conditions that apply to the contract for the retail banking service ; (b) (i) on the first occasion that the firm proposes to exercise a right of set-off in its dealings with the consumer ; and (ii) where appropriate, on any subsequent occasion that the firm proposes to exercise a right of set-off in its dealings with the consumer ; provide general information in relation to the nature of the firm's right of set-off and the generic circumstances in which the firm may rely on that right within a reasonable period before the firm seeks to exercise its right of set-off . The FCA considers that this information should be provided at least 14 days before the firm seeks to exercise its right of set-off . It may be incorporated in another communication sent by the firm to the consumer ; and (c) where it has exercised a right of set-off , provide prompt notification of this to the consumer . This notification should clearly identify the date that the firm exercised its right of set-off and the amount debited from the consumer's account in reliance on that right. (3) The information referred to in (2) should be provided in plain and intelligible language on paper or in another durable medium . (4) In determining whether it is appropriate to provide general information under (2)(b)(ii), the firm should consider the period of time that has elapsed since the firm last provided that information under (2)(b)(i) or (ii). (5) Nothing in (2)(a)(ii) should be considered as expressing a view on the validity, enforceability or fairness of any right of set-off in relation to a joint account that a firm considers it is entitled to exercise. BCOBS 4.1.5 01/11/2009 G The information required by the appropriate information rule may vary according to matters such as: (1) the banking customer's likely or actual commitment; (2) the information needs of a reasonable recipient having regard to the type of retail banking service that is proposed or provided and its overall complexity, main benefits, risks, limitations, conditions and duration; (3) distance communication information requirements (for example, under the distance communication rules less information can be given during certain telephone sales than in a sale made purely by written correspondence (see BCOBS 3.1 )); and (4) whether the same information has been provided to the banking customer previously and, if so, when that was. BCOBS 4.1.6 01/11/2009 G The existence of cancellation rights does not affect what information it is appropriate to give a banking customer in order to enable him to make an informed purchasing decision. BCOBS 4.1.7 06/04/2017 G If the retail banking service is a cash deposit ISA , cash-only lifetime ISA or a cash deposit CTF , the rules in COBS 13.1 (Preparing product information) and COBS 14.2 (Providing product information to clients) also apply. BCOBS 4.2 Statements of account BCOBS 4.2.1 01/11/2009 R (1) A firm must provide or make available to a banking customer on paper or in another durable medium such regular statements of account as are appropriate to the type of retail banking service provided, but need not do so where: (a) the firm has provided a banking customer with a pass book or other document in a durable medium that records transactions in relation to the retail banking service ; (b) the retail banking service is provided at a distance by means of electronic equipment where the banking customer can access his account balance, view transactions and give instructions in relation to the retail banking service at a distance by such means; (c) a banking customer has elected not to receive periodic statements of account, and for so long as such election is in force; or (d) it has reasonable grounds to believe that the banking customer is not resident at the address last known to it as the address of the banking customer and it is not practicable after reasonable inquiry to ascertain the banking customer's address. (2) A firm must not charge for providing information which is required to be provided by (1). (3) A firm must provide a banking customer with a true copy of any statement of account provided to him under (1) on paper or in another durable medium within a reasonable period of time following a request to that effect made by or on his behalf. (4) A firm and a banking customer may agree on a charge for: (a) providing a copy of a statement of account under (3); or (b) providing statements of account more frequently than required by (1); at the request of the banking customer . Any such charge must reasonably correspond to the firm's actual costs. BCOBS 4.2.2 01/12/2016 G A firm should indicate the rate or rates of interest that apply to a retail banking service in each statement of account provided or made available to a banking customer in respect of that retail banking service in accordance with BCOBS 4.2.1R (1) . Firms are also reminded of the provisions of BCOBS 4.1.2G (2B) and (2C). BCOBS 4.3 Information to be provided by a non ring-fenced body to individual account holders Application and purpose BCOBS 4.3.1 01/12/2016 G Article 14 of the Financial Services and Markets Act 2000 (Ring-fenced Bodies and Core Activities) Order 2014 “the Ring-fenced Bodies and Core Activities Order 2014” places a duty on the FCA to make rules specifying the information that a non ring-fenced body must provide to certain classes of individuals. The purpose of this section is to set out those rules . BCOBS 4.3.2 01/12/2016 R This section applies to a firm that is a non ring-fenced body or is to become a non ring-fenced body . BCOBS 4.3.3 01/08/2025 G A non ring-fenced body is a firm which has a Part 4A permission to carry on the regulated activity of accepting deposits and which is neither a ring-fenced body nor an institution which is exempt from the definition of a ring-fenced body. Section 142A(1) of the Act defines a ring-fenced body as a UK institution which carries out one or more core activities under section 142B of the Act for which it has a Part 4A permission . Section 142A(2) of the Act and the Ring-fenced Bodies and Core Activities Order 2014 provide that a building society and certain other classes of UK institution are exempt from this definition. Further, firms do not fall within the definition unless they hold deposits in UK accounts . To whom must information be provided? BCOBS 4.3.4 01/08/2025 R (1) A firm that is to become a non ring-fenced body must provide the information specified in BCOBS 4.3.6R to any individual from whom the firm proposes to accept, or contemplates it is likely to receive, a declaration of eligibility under article 9(1)(a) of the Ring-fenced Bodies and Core Activities Order 2014 (whether accompanied by a confirming statement or not). (2) A firm that is a non ring-fenced body must provide the information specified in BCOBS 4.3.6R to: (a) any individual who has applied to open a UK account for the purpose of making one or more deposits (including a joint account) with that firm ; and (b) any individual who holds a UK account for that purpose (including a joint account) with that firm , except where the firm has already provided that information to the individual on a previous occasion. BCOBS 4.3.5 01/08/2025 G A request made by an individual to switch to a UK account with a firm is to be regarded as an application to open a UK account with that firm (it is immaterial if the switch is from an account held with a ring-fenced body in the same group as the firm or whether the existing account will be closed when the switch is complete). What information must be provided? BCOBS 4.3.6 01/12/2016 R The information required to be provided by BCOBS 4.3.4R is: (1) a summary of the purpose of the provisions of Part 9B of the Act (Ring-fencing) and of the key risks to which a non ring-fenced body may be exposed which distinguish it from a ring-fenced body ; (2) a description of any excluded activity which the firm is carrying on or (for information provided before the date on which Part 9B of the Act comes fully into force) a description of any activity the firm is carrying on which would, if carried on after that date, be an excluded activity ; and (3) a description of any prohibited action which the firm has taken or (for information provided before the date on which Part 9B of the Act comes fully into force) a description of any action the firm has taken which would, if taken after that date, be a prohibited action . BCOBS 4.3.7 01/12/2016 G (1) The summary described in BCOBS 4.3.6R(1) should include a brief explanation that the purpose of ring-fencing is to separate the retail banking activities, on which households and small businesses depend, from wholesale or investment banking activities which may involve a greater degree of risk and expose an entity undertaking those activities to financial problems arising elsewhere in the global financial system. It should also indicate that certain ring-fenced bodies carrying on retail banking activities will have to comply with restrictions on the other activities they can undertake, and with rules made by the appropriate regulator intended to ensure that they are capable of carrying on the business of providing the core services related to the acceptance of deposits independently of other members in their group. They will, for example, not be able to carry on activities called ‘excluded activities’ which make them vulnerable to problems arising in the financial system or which may make it more difficult for banks to be wound down in an orderly fashion. The summary should explain that, as a non ring-fenced body , the firm is not subject to these restrictions. (2) It is not necessary for the information provided under BCOBS 4.3.6R (2) and (3) to contain an exhaustive list of each specific activity or action that constitutes an excluded activity or prohibited action , so long as the information about the nature of the activities and actions is sufficient to enable the individual to make an informed decision as to whether to open or continue to hold an account with the firm in the light of its status as a non ring-fenced body . When must the information be provided? BCOBS 4.3.8 01/12/2016 R (1) The information required to be provided under BCOBS 4.3.4R(1) must be provided in good time before the individual becomes an eligible individual in relation to the firm . (2) The information required to be provided under BCOBS 4.3.4R(2)(a) must be provided in good time before the individual opens an account with the firm . (3) The information required to be provided under BCOBS 4.3.4R(2)(b) must be provided as soon as practicable after the firm has become a non ring-fenced body . BCOBS 4.3.9 01/12/2016 G In determining what is “in good time” under BCOBS 4.3.8R , the firm should consider the time at which the information may be most useful to the individual in making a decision as to whether to continue to hold or to open an account with the firm . How must the information be provided? BCOBS 4.3.10 01/12/2016 R The information required under BCOBS 4.3.4R must be provided: (1) in writing; (2) in a prominent manner and in a medium that is calculated to bring the information to the attention of the individual to whom it is addressed; and (3) in easily understandable language and in a clear and comprehensible form, so that the individual can make a decision as to whether to continue to hold or to open an account with the firm on an informed basis. BCOBS 4.3.11 01/12/2016 R A firm must not charge for providing the information required to be provided by BCOBS 4.3.4R . Requirement to publish the information on a website BCOBS 4.3.12 01/12/2016 R A firm must, on or before the first date it is required to provide information under BCOBS 4.3.4R , make the information in BCOBS 4.3.6R accessible continuously on its website and keep such information up to date. BCOBS 4.4 Further information to be provided about personal current accounts BCOBS 4.4.1 18/12/2019 R (1) The rules in this section apply to a firm that offers personal current accounts, unless all personal current accounts offered by the firm are excluded accounts. (2) In this section, a “personal current account” means an account, other than a current account mortgage, which is a payment account within the meaning of the Payment Accounts Regulations (see BCOBS 4.4.2G(1) ). (3) In this section, an “excluded account” is a personal current account that is offered on terms that: (a) an agreement which provides authorisation in advance for the banking customer to overdraw on the account cannot arise; and (b) either: (i) the account cannot become overdrawn without prior arrangement; or (ii) no charge is payable (by way of interest or otherwise) if the account becomes overdrawn without prior arrangement; and (c) no charge is payable where the firm refuses a payment due to lack of funds. BCOBS 4.4.2 18/12/2019 G (1) The definition of “personal current account” refers to the definition of a “payment account” under the Payment Accounts Regulations , that is: “an account held in the name of one or more consumers through which consumers are able to place funds, withdraw cash and execute and receive payment transactions to and from third parties, including the execution of credit transfers, but does not include any of the following types of account provided that the account is not used for day-to-day payment transactions: savings accounts; credit card accounts where funds are usually paid in for the sole purpose of repaying a credit card debt; current account mortgages or e-money accounts”. The FCA has issued guidance on this definition: see ‘FG16/6 – Payment Accounts Regulations 2015’ . [ Note: https://www.fca.org.uk/publications/finalised-guidance/fg16-6- payment-accounts-regulations-2015 -definition-payment-account (2) The definition of “excluded account” captures personal current accounts where there cannot be a pre-arranged overdraft facility, there cannot be an unarranged overdraft to which interest or charges apply and charges for refusing a payment due to lack of funds cannot arise. (3) Firms are reminded that additional requirements apply in relation to consumer credit lending under CONC 4 (Pre-contractual requirements). Further information to be communicated to applicants for a personal current account BCOBS 4.4.3 18/12/2019 R A firm that this section applies to must communicate to a banking customer who applies for a personal current account that is not an excluded account: (1) general information about overdrafts consisting of, so far as relevant to the account applied for: (a) an explanation that an overdraft is a borrowing or credit facility; (b) a general description of the nature and principal features of arranged and unarranged overdrafts associated with the personal current accounts offered by the firm ; (c) a general explanation of the principal risks associated with: (i) overdrawing without prior arrangement; and (ii) opting out of an unarranged overdraft facility (if the firm’s terms and conditions permit this). (d) a general explanation of what may happen when a customer attempts to exceed an arranged overdraft limit or to overdraw in the absence of an arranged overdraft; (e) a general explanation of how the use of an arranged or unarranged overdraft might impact the banking customer’s credit file; (2) information about the availability of the following tools and how the banking customer can access them: (a) the overdraft cost calculator required by BCOBS 8.2 ; and (b) (if BCOBS 8.3 applies to the firm in relation to the personal current account) the overdraft eligibility tool required by BCOBS 8.3 ; and (3) general information about reductions in arranged overdraft limits including: (a) whether the banking customer can request the reduction or removal of their arranged overdraft facility after the personal current account has been opened; (b) how the banking customer can do this; and (c) any limitations or conditions on the banking customer’s ability to do this. BCOBS 4.4.4 18/12/2019 R A firm that is required to provide alerts relating to the personal current account or chooses to do so must communicate to a banking customer who applies for a personal current account: (1) a description of any alerts that the banking customer will automatically receive, including any alerts required under the rules in BCOBS 8.4 ; (2) a description of any (or any additional) alerts the banking customer may choose to receive; (3) an explanation of how alerts can assist the banking customer to manage overdraft use and associated costs; and (4) information about the availability of any options to customise the alerts the banking customer receives to suit the banking customer’s needs, and the methods available for doing so. BCOBS 4.4.5 18/12/2019 R Where the banking customer applies for a personal current account without at the same time applying for a pre-arranged overdraft, a firm need not communicate the information set out in BCOBS 4.4.3R(2)(b) and (3). BCOBS 4.4.6 18/12/2019 R A firm must communicate the information required by BCOBS 4.4.3R and BCOBS 4.4.4R to a banking customer who already holds a personal current account with a firm and who subsequently applies for a pre-arranged overdraft as though they were a banking customer applying for a personal current account. BCOBS 4.4.7 18/12/2019 G (1) A firm may consider including the following in the information communicated to comply with BCOBS 4.4.3R(1) : (a) that overdrafts are primarily intended for short-term borrowing and are not generally suitable for longer-term borrowing; (b) an explanation of what an arranged overdraft is and how to request one; (c) an explanation of what an unarranged overdraft is and how it might arise; (d) that use of an overdraft will or may give rise to interest or other charges (as applicable) and how the banking customer can find out more; and (e) that attempting to exceed a credit limit or become overdrawn without a pre-arranged overdraft may result in items not being paid and that this will or may incur charges. (2) Where the nature and features of arranged and unarranged overdrafts associated with the personal current accounts offered by the firm differ significantly between accounts, the firm may either set out the ways in which they differ or communicate only the information specific to the type of account the banking customer has applied for or is eligible for (if known). (3) The information communicated under this section should be general in nature, but a firm may indicate where additional or more detailed information can be found. Method and timing of communication BCOBS 4.4.8 18/12/2019 R (1) Except as otherwise provided in this rule , a firm must communicate the information required under BCOBS 4.4.3R to BCOBS 4.4.6R by providing it to the banking customer before the conclusion of the agreement for the personal current account, except and in so far as the information has been made available to the banking customer in accordance with (2). (2) Information is made available to a banking customer in accordance with this paragraph if it is presented in such a way that it must have been viewed by the banking customer before making an application. (3) A firm must consider the point during the application at which the information will be most relevant and useful to a banking customer and provide the information at that time where practicable. (4) Where the personal current account is opened using a means of distance communication which prevents the firm from complying with (1), for example by voice telephony, a firm may instead provide the information as soon as practicable after the agreement for the personal current account is concluded. BCOBS 4.4.9 18/12/2019 G (1) The effect of BCOBS 4.4.8R is that all banking customers who open a personal current account other than an excluded account will receive the information required by BCOBS 4.4.3R to 4.4.6R either before, during or immediately after the account opening process. (2) Where the firm’s website or mobile application constitutes or includes a direct offer financial promotion in relation to the personal current account, the information required by BCOBS 4.4.3R (1) and (2) should have been included in this material in accordance with BCOBS 2.2B . If that material is published in such a way that a potential banking customer will view it before they commence their application, the firm need not communicate it again. (3) The provision of an application form to a banking customer is an opportunity to provide the information required by this section. A firm that provides paper application forms for its personal current accounts to banking customers should consider whether to supply the information required by BCOBS 4.4.3R to 4.4.6R alongside the application form, or whether a more appropriate opportunity to supply some or all of it will arise before the account being opened. (4) The following are examples of appropriately-timed disclosures during an application process: (a) providing the information required by BCOBS 4.4.3R(2) (about available calculators) at an early stage in the process to allow the banking customer to assess the suitability of the personal current account before completing the application; (b) where a firm allows a banking customer to customise alerts during the application process, providing the information in BCOBS 4.4.4R when offering that opportunity; and (c) where a firm allows a banking customer to select whether to apply for an arranged overdraft during the application process, providing the information in BCOBS 4.4.3R(3) when offering that opportunity. BCOBS 4.4.10 18/12/2019 R (1) The information required to be communicated under BCOBS 4.4.3R to 4.4.6R must be communicated in writing and be: (a) concise; (b) in clear, simple language; and (c) presented prominently. (2) The information required to be communicated under BCOBS 4.4.3R(1) must be presented together. BCOBS 4.4.11 18/12/2019 G (1) Information will not be treated as presented prominently unless it is presented, having regard to other content it is presented alongside, in such a way that it is likely that the attention of the average banking customer would be drawn to it. (2) When providing information electronically, information is unlikely to be presented prominently if all that is provided is a link to a separate webpage where it can be viewed, or the option to download and open a separate file containing it. (3) Although the information is required to be in writing, it is not required to be in a durable medium . Information about overdrafts to be made generally available BCOBS 4.4.12 18/12/2019 R (1) A firm must make available general information about overdrafts covering the information required to be communicated under BCOBS 4.4.3R(1) for each of the trading names under which it offers personal current accounts other than excluded accounts in either or both of the following ways: (a) by publishing it in writing in an easily accessible place on the website of the brand; and (b) by publishing it in writing in an easily accessible way through a mobile banking application associated with the brand. (2) A firm should choose how and where to make available the general information required under this rule so as to be consistent with how it ordinarily communicates with its customers . It should select a method most likely to come to the attention of its customers and potential customers . (3) A firm that makes the information required under this rule available only through a mobile telephone application must refer on the website of the brand to the availability of such information through that application. (4) BCOBS 4.4.7G , BCOBS 4.4.10R and BCOBS 4.4.11G(1) apply to information required to be published under this rule as they apply to information required to be communicated under BCOBS 4.4.3R(1) . BCOBS 4.4.13 18/12/2019 G Where the firm is subject to BCOBS 8.2 (Cost calculator) or BCOBS 8.3 (Eligibility calculator) it will be required to make these tools available, or publish a reference to their availability, alongside the information required to be published under BCOBS 4.4.12R (see BCOBS 8.2.3R and BCOBS 8.3.3R ). Previous Chapter Next Chapter Accessibility Terms & Conditions Privacy Policy Legal Information Sitemap Social Contact FCA Head Office 12 Endeavour Square London E20 1JN Contact us Is there anything wrong with this page? Copyright © 2025 FCA. All rights reserved. Back to top Company no. 01920623 Designed and Maintained by FinregE Limited | https://finreg-e.com | 2025-11-15T10:23:17.986742 | regulatory_text | UK | FCA | [] | 8 | 0.978 | 0.933 | 6,411 |
FCA Handbook | https://handbook.fca.org.uk/handbook/sysc14 | FCA Handbook - SYSC 14 Risk management and associated systems and controls for insurers | sysc14 | Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve it by giving your feedback . Home Latest News Published Date This Month Submit Reset FC[ORG] Handbook Select Timeline Track Changes View Chapter as PDF View Sourcebook as PDF Glossary Select Timeline Track Changes Filter by provision Submit Reset Instruments Made by last board Instrument Type Effective Date Last 7 Days Last 15 Days Last 30 Days Last 90 Days Published Date Last 30 Days Last 90 Days Last Year Filter by Module Submit Reset Forms Type Effective Date Last 7 Days Last 30 Days Last 90 Days Last Year Submit Reset Technical Standards Select Timeline Track Changes Level 3 Materials Filter by Dossier Submit Reset Advanced Search User Guides Video Guides Reader's Guide Navigation Guide Useful Links Search Guide Timeline Guide FAQ Handbook Archive Submit Reset Administrator External Users [ORG] Users Role List [ORG] Latest News Stage FCA Handbook Stage FCA Glossary Stage Instruments Stage Forms Stage Level 3 Materials Stage Technical Standards Stage [ORG]A Website Useful Links Advanced Search Help [ORG] Handbook in print SignUp / SignIn [ORG] Website PRA Rulebook Useful Links Contact Us Advanced Search Search Clear Home FC[ORG] Handbook SYSC SYSC 14 SYSC 14 Risk management and associated systems and controls for insurers You are viewing SYSC 14 Risk management and associated systems and controls for insurers as of 15/11/2025 . SYSC 14 Risk management and associated systems and controls for insurers was last updated on 01/01/2021 . Rules Guidance Deleted Taxonomy SYSC 14.1 Application SYSC 14.1.1 01/01/2021 R This section applies to an insurer unless it a non-directive friendly society . SYSC 14.1.2 01/01/2021 R This section applies to a Swiss general insurer only in respect of the activities of the firm carried on from a branch in the [LOC] . SYSC 14.1.2A 29/06/2018 R This section does not apply to: (1) an incoming [ORG]A provider acting as such; or (2) a firm in relation to benchmark activities . SY[ORG] 14.1.2AA 13/12/2017 R This section applies to a [LOC] ISPV . Internal controls: introduction SYSC 14.1.27 31/12/2006 R A firm must take reasonable steps to establish and maintain adequate internal controls . SYSC 14.1.28 31/12/2006 G The precise role and organisation of internal controls can vary from firm to firm . However, a firm's internal controls should normally be concerned with assisting its governing body and relevant senior managers to participate in ensuring that it meets the following objectives: (1) safeguarding both the assets of the firm and its customers , as well as identifying and managing liabilities; (2) maintaining the efficiency and effectiveness of its operations; (3) ensuring the reliability and completeness of all accounting, financial and management information; and (4) ensuring compliance with its internal policies and procedures as well as all applicable laws and regulations. SYSC 14.1.29A 01/04/2013 G When determining the adequacy of its internal controls , a firm should consider both the potential risks that might hinder the achievement of the objectives listed in SYSC 14.1.28 G , and the extent to which it needs to control these risks. More specifically, this should normally include consideration of: (1) the appropriateness of its reporting and communication lines (see SYSC 3.2.2 G ); (2) how the delegation or contracting of functions or activities to employees , appointed representatives or, where applicable, its tied agents or other third parties (for example outsourcing ) is to be monitored and controlled (see SYSC 3.2.3 G to SYSC 3.2.4 G and the additional guidance on the management of outsourcing arrangements is also provided in SYSC 13.9 ); (3) the risk that a firm's employees or contractors might accidentally or deliberately breach a firm's policies and procedures (see SYSC 13.6.3 G ); (4) the need for adequate segregation of duties (see SYSC 3.2.5 G ); (5) the establishment and control of risk management committees; (6) the need for risk assessment and the establishment of a risk assessment function (see SYSC 3.2.10 G ); (7) the need for internal audit and the establishment of an internal audit function and audit committee (see SYSC 3.2.15 G to SYSC 3.2.16 G ). SYSC 14.1.29B 01/01/2016 G (1) SYSC 14.1.29G(6) does not apply to a Solvency II firm . (2) SYSC 14.1.29G(7) does not apply to a Solvency II firm , but only in relation to references to the internal audit function. It does apply to a Solvency II firm in relation to references to the internal audit committee. (3) For Solvency II firms , the PRA has made rules implementing the governance provisions of the Solvency II Directive relating to internal controls (article 46), see PRA Rulebook: Solvency II firms: Conditions Governing Business. (4) The Solvency II Regulation (EU) 2015/35 of 10 October 2014 also imposes specific requirements (see articles 266, 267 and 270). (5) The FCA will take the rules and requirements in (3) and (4) into account when considering a Solvency II firm’s internal controls. Previous Chapter Next Chapter Accessibility Terms & Conditions Privacy Policy Legal Information Sitemap Social Contact FCA Head Office 12 Endeavour Square London E20 1JN Contact us Is there anything wrong with this page? Copyright © 2025 FCA. All rights reserved. Back to top Company no. 01920623 Designed and Maintained by FinregE Limited | https://finreg-e.com | 2025-11-15T10:16:19.963084 | regulatory_text | UK | FCA | [] | 12 | 1 | 1 | 880 |
FCA Handbook | https://handbook.fca.org.uk/handbook/cass13 | FCA Handbook - CASS 13 Claims management: client money | cass13 | Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve it by giving your feedback . Home Latest News Published Date This Month Submit Reset FC[ORG] Handbook Select Timeline Track Changes View Chapter as PDF View Sourcebook as PDF Glossary Select Timeline Track Changes Filter by provision Submit Reset Instruments Made by last board Instrument Type Effective Date Last 7 Days Last 15 Days Last 30 Days Last 90 Days Published Date Last 30 Days Last 90 Days Last Year Filter by Module Submit Reset Forms Type Effective Date Last 7 Days Last 30 Days Last 90 Days Last Year Submit Reset Technical Standards Select Timeline Track Changes Level 3 Materials Filter by Dossier Submit Reset Advanced Search User Guides Video Guides Reader's Guide Navigation Guide Useful Links Search Guide Timeline Guide FAQ Handbook Archive Submit Reset Administrator External Users [ORG] Users Role List CMS Latest News Stage FCA Handbook Stage FCA Glossary Stage Instruments Stage Forms Stage Level 3 Materials Stage Technical Standards Stage [ORG]A Website Useful Links Advanced Search Help FC[ORG] Handbook in print SignUp / SignIn [ORG] Website PRA Rulebook Useful Links Contact Us Advanced Search Search Clear Home FCA Handbook CASS CASS 13 CASS 13 Claims management: client money You are viewing CASS 13 Claims management: client money as of 15/11/2025 . CASS 13 Claims management: client money was last updated on 02/08/2024 . Rules Guidance Evidential Provisions Taxonomy CASS 13.1 Application CASS 13.1.1 01/04/2019 R This chapter applies to a firm that: (1) carries on a regulated claims management activity ; and (2) receives or holds client money . CASS 13.2 Organisational requirements and responsibility for CASS operational oversight CASS 13.2.1 01/04/2019 R A firm must, when holding client money , make adequate arrangements to safeguard the customer’s rights and prevent the use of client money for its own account. CASS 13.2.2 01/04/2019 R A firm must introduce adequate organisational arrangements to minimise the risk of the loss or diminution of client money , or of rights in connection with client money , as a result of misuse of client money , fraud, poor administration, inadequate record-keeping or negligence. CASS 13.2.3 01/04/2019 R A firm must allocate to a director or senior manager responsibility for: (1) oversight of the firm’s operational compliance with CASS 13 ; (2) reporting to the firm’s governing body in respect of that oversight; and (3) completing and submitting the client money parts of a CMC001 return in accordance with SUP 16.25.3R to SUP 16.25.8R . CASS 13.2.4 01/04/2019 R (1) A firm must make and retain an appropriate record of the person to whom responsibility is allocated in accordance with CASS 13.2.3R . (2) But a firm must make and retain such a record only where: (a) there is a person in that firm who performs the compliance oversight function ; and (b) it allocates responsibility in accordance with CASS 13.2.3R to a person other than the person in that firm who performs the compliance oversight function . (3) A firm must ensure that a record made under this rule is retained for a period of five years after it is made. CASS 13.2.5 23/10/2020 G (1) This paragraph CASS 13.2.5G explains how CASS 13.2.3R fits into the senior managers and certification regime. This paragraph does not deal with a firm that is a PRA-authorised person . (2) The senior managers and certification regime is summarised in SYSC 23.3 (Overview of the senior managers and certification regime). (3) The function in CASS 13.2.3R is not a separate controlled function and performing that function does not require approval as an approved person . (4) There are three elements of the senior managers and certification regime that are particularly relevant to CASS 13.2.3R , although they do not all apply to all SMCR firms : (a) a firm’s obligation to allocate certain responsibilities to its SMF managers (see SYSC 24 (Senior managers and certification regime: Allocation of prescribed responsibilities)); (b) a firm’s obligation to ensure that one or more of its SMF managers have overall responsibility for each of its activities, business areas and management functions (see SYSC 26 (Senior managers and certification regime: Overall and local responsibility)); and (c) the certification regime (the certification regime is explained in SYSC 27 (Senior managers and certification regime: Certification regime) and SYSC TP 7 ( Bank of England and Financial Services Act 2016: Certification and regulatory references) explains that the certification regime comes into force sometime after other parts of the senior managers and certification regime). (5) (a) This paragraph (5) explains how CASS 13.2.3R applies to a limited scope SMCR firm . Most firms carrying on a regulated claims management activity will be limited scope SMCR firms . (b) Neither SYSC 24 nor SYSC 26 applies to a limited scope SMCR firm . (c) The firm may choose to allocate the function in CASS 13.2.3R to an SMF manager . (d) The firm may instead choose to allocate the function in CASS 13.2.3R to someone who is not an SMF manager . (e) Where (d) applies, the person performing the function in CASS 13.2.3R will fall into the certification regime. The function in CASS 13.2.3R will be the CASS oversight FCA certification function in SYSC 27.8.1R . (6) (a) This paragraph (6) explains how CASS 13.2.3R applies to a core SMCR firm . (b) SYSC 24 applies to a core SMCR firm but SYSC 26 does not. (c) The firm must allocate responsibility for the firm’s compliance with CASS to one of its SMF managers (see SYSC 24.2.1R ). That responsibility is an “ FCA-prescribed senior management responsibility ”. The full list of FCA-prescribed senior management responsibilities is in the table in SYSC 24.2.6R . (d) Although the CASS function in SYSC 24.2.1R is different from the function in CASS 13.2.3R , the firm may allocate the function in CASS 13.2.3R to the SMF manager in CASS 13.2.5G(6)(c) . (e) The firm may choose to allocate the function in CASS 13.2.3R to someone who is not an SMF manager . If so: (i) that person will be subject to the certification regime described in SYSC 27 (Senior managers and certification regime: Certification regime); (ii) that person will be subject to supervision by the SMF manager in (c); and (iii) the function in CASS 13.2.3R will be the CASS oversight FCA certification function in SYSC 27.8.1R . (7) (a) This paragraph (7) explains how CASS 13.2.3R applies to an enhanced scope SMCR firm . (b) Both SYSC 24 and SYSC 26 apply to an enhanced scope SMCR firm . (c) CASS 13.2.5G(6) applies to an enhanced scope SMCR firm . (d) In addition, the firm may allocate the CASS FCA-prescribed senior management responsibility to an SMF manager who does not perform any other function coming within the FCA regime for SMF managers in SMCR firms . See SUP 10C0.7 (Other overall responsibility function (SMF18)) and SUP 10C.8.1R (Other local responsibility function (SMF22)) for details. Where this is the case, the manager will be performing the other overall responsibility function or the other local responsibility function . (8) A firm may only give the function in CASS 13.2.3R to a director or senior manager . It is likely that an SMF manager will satisfy this condition. If the firm wants to give the function to someone else, it should make sure that it meets the requirements of CASS 13.2.3R as well as of the senior managers and certification regime. CASS 13.3 Statutory trust CASS 13.3.1 01/04/2019 R A firm receives and holds client money as trustee on the following terms: (1) for the purposes and on the terms of the claims management client money rules and the claims management client money distribution rules ; (2) subject to (3), for the customers for whom that money is held, according to their respective interests in it; (3) on failure of the firm , for the payment of the costs properly attributable to the distribution of the client money in accordance with (2); and (4) after all valid claims and costs under (2) and (3) have been met, for the firm itself. CASS 13.4 Selecting an approved bank at which to hold client money CASS 13.4.1 01/04/2019 G A firm owes a duty of care as a trustee to its clients in relation to client money and has to exercise that duty of care in deciding where to hold client money . CASS 13.4.2 01/04/2019 R Before a firm opens a client bank account and as often as is appropriate on a continuing basis (such frequency being no less than once in each financial year) it must take reasonable steps to establish that it is appropriate for the firm to hold client money at the approved bank concerned. CASS 13.4.3 01/04/2019 R A firm must consider the risks associated with holding all client money with one approved bank and should consider whether it would be appropriate to hold client money in client bank accounts at a number of different approved banks . CASS 13.4.4 01/04/2019 G In complying with CASS 13.4.3R , a firm should consider as appropriate, together with any other relevant matters: (1) the amount of client money held by the firm ; (2) the amount of client money the firm anticipates holding at the approved bank ; and (3) the creditworthiness of the approved bank . CASS 13.4.5 01/04/2019 G A firm can demonstrate compliance with CASS 13.4.2R by checking that the person it proposes to hold client money with is an approved bank and that nothing has come to the firm’s attention to cause it to believe that such person is not an appropriate place at which to hold client money . CASS 13.5 Client bank account acknowledgement letters CASS 13.5.1 01/04/2019 G The main purposes of a client bank account acknowledgement letter are: (1) to put the approved bank on notice of a firm’s clients’ interests in client money that has been deposited with such person ; (2) to ensure that the client bank account has been opened in accordance with CASS 13.6.3R , and is distinguished from any account containing money that belongs to the firm ; and (3) to ensure that the approved bank understands and agrees that it will not have any recourse or right against money standing to the credit of the client bank account , in respect of any liability of the firm to such person (or person connected to such person ). Requirement for and content of client bank account acknowledgement letters CASS 13.5.2 01/04/2019 R (1) For each client bank account , a firm must, in accordance with CASS 13.5.4R , complete and sign a client bank account acknowledgement letter clearly identifying the client bank account , and send it to the approved bank with whom the client bank account is, or will be, opened, requesting the bank to acknowledge and agree to the terms of the letter by countersigning it and returning it to the firm . (2) Subject to CASS 13.5.6R , a firm must not hold or receive any client money in or into a client bank account unless it has received a duly countersigned client bank account acknowledgement letter from the approved bank . The letter must not have been inappropriately redrafted and should clearly identify the client bank account . CASS 13.5.3 01/04/2019 R In drafting client bank account acknowledgement letters under CASS 13.5.2R a firm is required to use the relevant template in CASS 13 Annex 1R . CASS 13.5.4 01/04/2019 R When completing a client bank account acknowledgement letter under CASS 13.5.2R(1) a firm : (1) must not amend any of the acknowledgement letter fixed text ; (2) subject to (3), must ensure the acknowledgement letter variable text is removed, included or amended as appropriate; and (3) must not amend any of the acknowledgement letter variable text in a way that would alter or otherwise change the meaning of the acknowledgement letter fixed text . CASS 13.5.5 01/04/2019 G CASS 13 Annex 2G contains guidance on using the template client bank account acknowledgement letters , including on when and how firms should amend the acknowledgement letter variable text that is in square brackets. Countersignature by the bank CASS 13.5.6 01/04/2019 R (1) If, on countersigning and returning the client bank account acknowledgement letter to a firm , the relevant approved bank has also: (a) made amendments to any of the acknowledgement letter fixed text ; or (b) made amendments to any of the acknowledgement letter variable text in a way that would alter or otherwise change the meaning of the acknowledgement letter fixed text ; the client bank account acknowledgement letter will have been inappropriately redrafted for the purposes of CASS 13.5.2R(2) . (2) Amendments made to the acknowledgement letter variable text , in the client bank account acknowledgement letter returned to a firm by the relevant approved bank , will not have the result that the letter has been inappropriately redrafted if those amendments: (a) do not affect the meaning of the acknowledgement letter fixed text ; (b) have been specifically agreed with the firm ; and (c) do not cause the client bank account acknowledgement letter to be inaccurate. CASS 13.5.7 01/04/2019 R A firm must use reasonable endeavours to ensure that any individual that has countersigned a client bank account acknowledgement letter that has been returned to the firm was authorised to countersign the letter on behalf of the relevant approved bank . Retention of client bank account acknowledgement letters CASS 13.5.8 01/04/2019 R A firm must retain each countersigned client bank account acknowledgement letter it receives from the date of receipt until the expiry of a period of five years starting on the date on which the last client bank account to which the acknowledgment letter relates is closed. CASS 13.5.9 01/04/2019 R A firm must also retain any other documentation or evidence it believes is necessary to demonstrate that it has complied with each of the applicable requirements in this section (such as any evidence it has obtained to ensure that the individual that has countersigned a client bank account acknowledgement letter that has been returned to the firm was authorised to countersign the letter on behalf of the relevant approved bank ). Review and replacement of client bank account acknowledgement letters CASS 13.5.10 01/04/2019 R A firm must, periodically (at least annually, and whenever it becomes aware that something referred to in a client bank account acknowledgement letter has changed) review each of its countersigned client bank account acknowledgement letters to ensure that they remain accurate. CASS 13.5.11 01/04/2019 R Whenever a firm finds a countersigned client bank account acknowledgement letter to contain an inaccuracy, the firm must promptly draw up a new replacement client bank account acknowledgement letter under CASS 13.5.2R and ensure that the new client bank account acknowledgement letter is duly countersigned and returned by the relevant approved bank . CASS 13.5.12 01/04/2019 G Under CASS 13.5.10R , a firm should obtain a replacement client bank account acknowledgement letter whenever: (1) there has been a change in any of the parties’ names or addresses or a change in any of the details of the relevant account(s) as set out in the letter; or (2) it becomes aware of an error or misspelling in the letter. CASS 13.5.13 01/04/2019 R If a firm’s client bank account is transferred to another approved bank , the firm must promptly draw up a new client bank account acknowledgement letter under CASS 13.5.2R and ensure that the new client bank account acknowledgement letter is duly countersigned and returned by the relevant approved bank within 20 business days of the firm sending it to that person . CASS 13.6 Segregation and the operation of client money accounts Requirement to segregate CASS 13.6.1 01/04/2019 R A firm must take all reasonable steps to ensure that all client money it receives is paid directly into a client bank account at an approved bank , rather than being first received into the firm’s own account and then segregated. CASS 13.6.2 01/04/2019 G A firm should arrange for clients and third parties to make transfers and payments of any money which will be client money directly into the firm’s client bank accounts . CASS 13.6.3 01/04/2019 R A firm must ensure that client money is held in a client bank account at one or more approved banks . CASS 13.6.4 01/04/2019 R Cheques received by a firm , made out to the firm , representing client money or a mixed remittance must be treated as client money from receipt by the firm . CASS 13.6.5 01/04/2019 R Where a firm receives client money in the form of cash, a cheque or other payable order, it must: (1) pay the money into a client bank account in accordance with CASS 13.6.1R promptly and no later than the business day after the day on which it receives the money ; (2) if the firm holds the money overnight, hold it in a secure location in line with Principle 10; and (3) record the receipt of the money in the firm’s books and records under the applicable requirements of CASS 13.10 (Records, accounts and reconciliations). CASS 13.6.6 01/04/2019 R If a firm receives money (either in a client bank account or an account of its own) which it is unable immediately to identify as client money or its own money , it must: (1) take all necessary steps to identify the money as either client money or its own money ; and (2) if it considers it reasonably prudent to do so, given the risk that client money may not be adequately protected if it is not treated as such, treat the entire balance of money as client money and record the money in its books and records as “unidentified client money” while it performs the necessary steps under (1). CASS 13.6.7 01/04/2019 G If a firm is unable to identify money that it has received as either client money or its own money under CASS 13.6.6R(1) , it should consider whether it would be appropriate to return the money to the person who sent it (or, if that is not possible, to the source from where it was received, for example, the bank). A firm should have regard to its fiduciary duties when considering such matters. CASS 13.6.8 01/04/2019 G A firm must ensure that client money received by its agents is: (1) received directly into a client bank account of the firm ; or (2) if it is received in the form of a cheque or other payable order: (a) paid into a client bank account of the firm promptly and, in any event, no later than the next business day after receipt; or (b) forwarded to the firm promptly and, in any event, so that it is received by the firm no later than the close of the third business day following the receipt of the money from the customer ; or (3) if it is received in the form of cash, paid into a client bank account of the firm promptly and, in any event, no later than the next business day after receipt. Mixed remittance CASS 13.6.9 01/04/2019 R If a firm receives a mixed remittance it must: (1) pay the full sum into a client bank account promptly and in accordance with CASS 13.6.1R to 13.6.5R ; and (2) no later than one business day after the payment of the mixed remittance into the client bank account has cleared, pay the money that is not client money out of the client bank account . Interest CASS 13.6.10 01/04/2019 R A firm must pay a client any interest earned on client money held for that client . CASS 13.7 Money due and payable to the firm CASS 13.7.1 01/04/2019 R Money is not client money when it is or becomes properly due and payable to the firm for its own account. CASS 13.7.2 01/04/2019 G (1) The circumstances in which money may be or become due and payable to the firm for its own account could include: (a) when fees and/or third party disbursements have become due and payable to the firm for its own account under the agreement between the customer and the firm ; and (b) when money recovered for a customer or a sum in respect of damages, compensation or settlement of a claim is paid into a client bank account and the firm has agreed with the client that a proportion of the sum is to be paid to the firm for fees or in respect of liabilities the firm has incurred on behalf of the customer . (2) The circumstances in which money is due and payable will depend on the contractual arrangement between the firm and the client . CASS 13.7.3 01/04/2019 G Firms are reminded that when entering into or varying contractual arrangements with customers regarding circumstances in which money becomes properly due and payable to the firm for its own account, firms should comply with any relevant obligations to customers including the client’s best interests rule and requirements under the Unfair Terms Regulations and the Consumer Rights Act 2015 . CASS 13.8 Money due to a client or third party. CASS 13.8.1 01/04/2019 R Client money in respect of money recovered for a customer or money in respect of damages, compensation or settlement of a claim received into a client bank account must be paid to the customer , or a duly authorised representative of the customer , as soon as reasonably practicable after receipt and, in any event, a firm must take steps within two business days of receipt to make such a payment. CASS 13.8.2 01/04/2019 R Money received from a customer in respect of third party disbursements which is due and payable to the third party in accordance with the terms of the contractual arrangements between the parties should be paid to the third party as soon as reasonably practicable after receipt. CASS 13.9 Discharge of fiduciary duty CASS 13.9.1 01/04/2019 G CASS 13 provides important safeguards for the protection of client money held by firms that sit alongside the fiduciary duty owed by firms in relation to client money . CASS 13.9.2R to 13.9.3R provide for when money ceases to be client money for the purposes of CASS 13 and the fiduciary duty which firms owe to clients in relation to client money . CASS 13.9.2 02/08/2024 R Money ceases to be client money if: (1) it is paid to the customer , or a duly authorised representative of the customer ; or (2) it is: (a) paid to a third party on the instruction of the customer , or with the specific consent of the customer ; or (b) paid to a third party further to an obligation on the firm under any applicable law; or (3) it is paid into an account of the customer (not being an account which is also in the name of the firm ) on the instruction, or with the specific consent, of the customer ; or (4) it is due and payable to the firm for its own account (see CASS 13.7.1R to 13.7.2G ); or (5) it is paid to the firm as an excess in the client bank account (see CASS 13.10.15R(3) ); or (6) it is transferred to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022 and in accordance with CASS 13.9.4R . CASS 13.9.3 01/04/2019 R When a firm draws a cheque or other payable order to discharge its fiduciary duty to the client , it must continue to treat the sum concerned as client money until the cheque or order is presented and paid. Transfers of client money to a dormant asset fund operator under Part 1 of the Dormant Assets Act 2022 CASS 13.9.4 02/08/2024 R A firm may transfer a client money balance to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022. If it does so the transferred balance will cease to be client money under CASS 13.9.2R(6) , provided that the firm can demonstrate it took reasonable steps to trace the client concerned and to return the balance prior to making such a transfer. CASS 13.9.5 02/08/2024 E (1) Taking reasonable steps in CASS 13.9.4R includes following this course of conduct: (a) determining, as far as reasonably possible, the correct contact details for the relevant client ; (b) writing to the client at the last known address either by post or by electronic mail to inform it of the firm’s intention to no longer treat the client money balance as client money and to transfer the sums concerned to a dormant asset fund operator if the firm does not receive instructions from the client within 28 days (naming the specific relevant dormant asset fund operator ); (c) where the client has not responded after the 28 days referred to in (b), attempting to communicate the information set out in (b) to the client on at least one further occasion by any means other than that used in (b) including by post, electronic mail, telephone or media advertisement; (d) subject to (e) and (f), where the client has not responded within 28 days following the most recent communication, writing again to the client at the last known address either by post or by electronic mail to inform them: (i) that, as the firm did not receive a claim for the relevant client money balance, it will in 28 days transfer the balance to a dormant asset fund operator (naming the specific relevant dormant asset fund operator ); and (ii) of the steps that they must take to make a repayment claim ; (e) if the firm has carried out the steps in (b) or (c) and in response has received positive confirmation in writing that the client is no longer at a particular address, the firm should not use that address for the purposes of (d); (f) if, after carrying out the steps in (a), (b) and (c), the firm has obtained positive confirmation that none of the contact details it holds for the relevant client are accurate or, if utilised, the communication is unlikely to reach the client , the firm does not have to comply with (d); and (g) waiting a further 28 days following the most recent communication under this rule before transferring the balance to the dormant asset fund operator . (2) Compliance with (1) may be relied on as tending to establish compliance with CASS 13.9.4R . (3) Contravention of (1) may be relied on as tending to establish contravention of CASS 13.9.4R . CASS 13.9.6 02/08/2024 G (1) Unless the firm has failed and CASS 13.3.1R(3) applies, any costs associated with a firm ceasing to treat unclaimed client money balances as client money pursuant to CASS 13.9.4R should be paid for from the firm’s own funds. (2) When transferring a client money balance to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022, a firm will need to consider its obligations under any contractual or other arrangements of the sort described at section 23 of the Dormant Assets Act 2022 in addition to meeting its obligations under the claims management client money rules and the claims management client money distribution rules . CASS 13.10 Records, accounts and reconciliations Records and accounts CASS 13.10.1 01/04/2019 R (1) A firm must keep such records and accounts as are necessary to enable it, at any time and without delay, to distinguish client money held for one customer from client money held for any other customer , and from its own money . (2) A firm must allocate in its books and records any client money it receives to an individual customer promptly and, in any case, no later than two business days following the receipt. (3) Pending a firm’s allocation of a receipt of client money to an individual customer under (2), it must record the received client money in its books and records as “unallocated client money”. CASS 13.10.2 01/04/2019 G In accordance with CASS 13.10.1R , a firm must maintain internal records and accounts of the client money it holds (for example, a cash book and client ledger accounts). These internal records are separate to any external records it has obtained from approved banks with whom it has deposited client money (for example, bank statements). CASS 13.10.3 01/04/2019 R A firm must maintain its records and accounts in a way that ensures their accuracy and, in particular, their correspondence to the client money held for individual customers . CASS 13.10.4 01/04/2019 R A firm must maintain up-to-date records that detail all payments received for, or on behalf of, customers and all payments to, from, or made on behalf of, customers . Internal client money reconciliation CASS 13.10.5 01/04/2019 R A firm must carry out an internal client money reconciliation each business day . CASS 13.10.6 01/04/2019 R An internal client money reconciliation requires a firm to check whether its client money resource, as determined by CASS 13.10.8R , on the previous business day , was at least equal to the client money requirement, as determined by CASS 13.10.9R , as at the close of business on that day. CASS 13.10.7 01/04/2019 R In carrying out an internal client money reconciliation , a firm must use the values contained in its internal records and ledgers (for example, its cash book or other internal accounting records), rather than the values contained in the records it has obtained from approved banks with whom it has deposited client money (for example, bank statements). Calculating the client money resource CASS 13.10.8 01/04/2019 R The client money resource for client money held in accordance with CASS 13.10.6R is the aggregate of the balances on the firm’s client bank accounts , as at the close of business on the previous business day . Calculating the client money requirement CASS 13.10.9 01/04/2019 R (1) The client money requirement is the sum of: (a) the aggregate of all individual customer balances calculated in accordance with CASS 13.10.13R and CASS 13.10.14R ; (b) the amount of any unallocated client money under CASS 13.10.1R(3) ; (c) the amount of any unidentified client money under CASS 13.6.6R(2)R ; and (d) any other amounts of client money included in the calculation under (2). (2) For the purposes of (1)(d), the firm must consider whether there are amounts of client money , other than those in (1)(a) to (c), to which the requirement to segregate applies and that it is appropriate to include in the calculation of its client money requirement and, if so, adjust the calculation accordingly. CASS 13.10.10 01/04/2019 G The client money requirement calculated in accordance with CASS 13.10.9R should represent the total amount of client money a firm is required to have segregated in client bank accounts under CASS 13 . CASS 13.10.11 01/04/2019 G Firms are reminded that, under CASS 13.9.3R , if a firm has drawn any cheques, or other payable orders, to discharge its fiduciary duty to its clients (for example, to return client money to the client ), the sum concerned must be included in the firm’s calculation of its client money requirement until the cheque or order is presented and paid. CASS 13.10.12 01/04/2019 G (1) The following guidance applies where a firm receives client money in the form of cash, a cheque or other payable order. (2) In carrying out the calculation of the client money requirement, a firm may initially include the amount of client money received as cash, cheques or payment orders that has not yet been deposited in a client bank account in line with CASS 13.6.5R . If it does so, the firm should ensure, before finalising the calculation, that it deducts these amounts to avoid them giving rise to a difference between the firm’s client money requirement and client money resource. (3) In carrying out the calculation of the client money requirement, a firm may alternatively exclude the amount of client money received as cash, cheques or payment orders that has not yet been deposited in a client bank account in line with CASS 13.6.5R . If it does so, the firm is reminded that it must separately record the receipt of the money in the firm’s books and records under CASS 13.6.5R(3) . (4) A firm that receives client money in the form of cash, a cheque or other payable order is reminded that it must pay that money into a client bank account promptly and no later than on the business day after it receives the money (see CASS 13.6.5R ). CASS 13.10.13 01/04/2019 R The individual customer balance for each client must be calculated as follows: (1) the amount received for or on behalf of the customer by the firm ; plus (2) the amount of any interest, and any other sums, due from the firm to the customer ; less: (3) the aggregate of the amount of money : (a) paid to that customer by the firm ; and (b) due and payable by the customer to the firm ; and (c) due by the customer to a third party in accordance with the contractual arrangements in place between the firm and the customer . CASS 13.10.14 01/04/2019 R Where the individual customer balance calculated in respect of an individual client under CASS 13.10.13R is a negative figure (because the amounts received for or on behalf of, or due, to a client under CASS 13.10.13R(1) and CASS 13.10.13R(2) are less than the amounts paid by, or due and payable by, that customer under CASS 13.10.13R(3) , that individual customer balance should be treated as zero for the purposes of the calculation of the firm’s client money requirement in CASS 13.10.9R . Reconciliation differences and discrepancies CASS 13.10.15 01/04/2019 R When an internal client money reconciliation reveals a difference between the client money resource and its client money requirement a firm must: (1) identify the reason for the difference; (2) ensure that any shortfall in the amount of the client money resource as compared to the amount of the client money requirement is made up by a payment into the firm’s client bank accounts by the end of the business day following the day on which the difference was discovered; and (3) ensure that any excess in the amount of the client money resource as compared to the amount of the client money requirement is withdrawn from the firm’s client bank accounts by the end of the business day following the day on which the difference was discovered. External client money reconciliation CASS 13.10.16 01/04/2019 G The purpose of the reconciliation process required by CASS 13.10.17R is to ensure the accuracy of a firm’s internal accounts and records against those of any third parties by whom client money is held. CASS 13.10.17 01/04/2019 R A firm must perform an external client money reconciliation : (1) each business day ; and (2) as soon as reasonably practicable after the relevant internal client money reconciliation ; to ensure the accuracy of its internal accounts and records by comparing its internal accounts records against those of approved banks with whom client money is deposited. CASS 13.10.18 01/04/2019 G An external client money reconciliation requires a firm to conduct a reconciliation between its internal accounts and records and those of any approved banks by whom client money is held. CASS 13.10.19 01/04/2019 R When any discrepancy is revealed by an external client money reconciliation , a firm must identify the reason for the discrepancy and correct it as soon as possible, unless the discrepancy arises solely as a result of timing differences between the accounting system of the party providing the statement or confirmation and that of the firm . CASS 13.10.20 01/04/2019 R While a firm is unable to resolve a discrepancy arising from an external client money reconciliation , and one record or a set of records examined by the firm during the reconciliation process indicates that there is a need to have greater amount of client money than is in fact the case, the firm must assume, until the matter is finally resolved, that the record or set of records is accurate and pay its own money into a relevant client bank account . Notification requirements CASS 13.10.21 01/04/2019 R A firm must inform the FCA in writing without delay if: (1) its internal records and accounts of client money are materially out of date or materially inaccurate so that the firm is no longer able to comply with the requirements in CASS 13.10.1R to CASS 13.10.4R ; or (2) it will be unable to or materially fails to conduct an internal client money reconciliation in compliance with CASS 13.10.5R ; or (3) after having carried out an internal client money reconciliation in accordance with CASS 13.10.5R it will be unable to, or materially fails to, pay any shortfall into (or withdraw any excess from) a client bank account so that the firm is unable to comply with CASS 13.10.15R ; or (4) it will be unable to or materially fails to conduct an external client money reconciliation in compliance with CASS 13.10.17R ; or (5) after having carried out an external client money reconciliation in accordance with CASS 13.10.17R it will be unable to, or materially fails to, identify the reason for any discrepancies and correct them in accordance with CASS 13.10.19R ; or (6) it becomes aware that, at any time in the preceding 12 months , the amount of client money segregated in its client bank accounts materially differed from the total aggregate amount of client money the firm was required to segregate in client bank accounts in accordance with the segregation requirements in CASS 13.6 . CASS 13.11 Client money distribution in the event of a failure of a firm or approved bank Application CASS 13.11.1 01/04/2019 R This section (the claims management client money distribution rules ) applies to a firm that holds client money which is subject to the claims management client money rules when a primary pooling event or a secondary pooling event occurs. Purpose CASS 13.11.2 01/04/2019 G The claims management client money distribution rules seek, in the event of the failure of a firm or of an approved bank at which the firm holds client money , to protect client money and to facilitate the timely return of client money to clients. Failure of the authorised firm: primary pooling event CASS 13.11.3 01/04/2019 R A primary pooling event occurs: (1) on the failure of the firm ; (2) on the vesting of assets in a trustee in accordance with an ‘assets requirement ’ imposed under section 55P(1)(b) or (c) (as the case may be) of the Act ; or (3) on the coming into force of a requirement or requirements which, either separately or in combination: (a) is or are for all client money held by the firm ; and (b) require the firm to take steps to cease holding all client money . Pooling and distribution after a primary pooling event CASS 13.11.4 01/04/2019 R If a primary pooling event occurs, then: (1) all client money : (a) held in the firm’s client bank accounts ; and (b) any client money identifiable in any other account held by the firm into which client money has been received; is treated as pooled together to form a notional pool; and (2) a firm must calculate the amount it should be holding on behalf of each individual customer as at the time of the primary pooling event using the method of calculating individual customer balance provided for by CASS 13.10.13R . Distribution if client money not transferred to another firm CASS 13.11.5 01/04/2019 R Where a primary pooling event occurs and the client money pool is not transferred to another firm in accordance with CASS 13.11.6R , a firm must distribute client money comprising the notional pool so that each client receives a sum that is rateable to its entitlement to the notional pool calculated in accordance with CASS 13.11.4R(2) . CASS 13.11.5A 02/08/2024 R (1) Subject to (2), as an alternative to distributing a client’s client money to them under CASS 13.11.5R , a firm may transfer all of that client’s client money to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022 and in accordance with CASS 13.9.4R . (2) As a consequence of any such transfer to a dormant asset fund operator , the firm must not distribute to any other client an amount of money that would be less than that which such other client was entitled to have distributed under CASS 13.11.5R . CASS 13.11.5B 02/08/2024 G The purpose of CASS 13.11.5AR(2) is to ensure that where a particular client’s client money is transferred under CASS 13.11.5AR(1) to a dormant asset fund operator , such a transfer does not prejudice any other client . This means, for example, that the amount that may be transferred to a dormant asset fund operator under that provision should take account of any shortfall that affects the relevant clients . Transfer of client money to another firm CASS 13.11.6 01/04/2019 R If, in the event of a primary pooling event occurring, the regulated claims management activity business undertaken by a firm (“the transferor”) is to be transferred to another firm (“the transferee”), then the transferor may move the client money pool to the transferee. CASS 13.11.7 01/04/2019 R If the transferor decides to move the client money pool to the transferee, the transferor must immediately on making the decision, and before the move takes place, notify the FCA in writing of: (1) the proposed move, including the date of the proposed move if known at the time of the notification; and (2) the proposed transferee. CASS 13.11.8 01/04/2019 R The client money pool may be transferred under CASS 13.11.6R only if it will be held by the transferee in accordance with CASS 13 , including the statutory trust in CASS 13.3.1R . CASS 13.11.9 01/04/2019 R If there is a shortfall in the client money transferred under CASS 13.11.6R then the client money must be allocated to each of the customers for whom the client money was held so that each client is allocated a sum which is rateable to that customer’s client money entitlement in accordance with CASS 13.11.4R(2) . This calculation may be done by either transferor or transferee in accordance with the terms of any transfer. CASS 13.11.10 01/04/2019 R The transferee must, within seven days after the transfer of client money under CASS 13.11.6R notify customers that: (1) their money has been transferred to the transferee; and (2) they have the option of having client money returned to them or to their order by the transferee, otherwise the transferee will hold the client money for the customers and conduct regulated claims management activities for those customers . Closing a client money pool - transfers to dormant asset fund operator CASS 13.11.10A 02/08/2024 R (1) This rule applies to a firm which, prior to a primary pooling event , had put in place contractual or other arrangements with a dormant asset fund operator of the sort described at section 23 of the Dormant Assets Act 2022. (2) If, having attempted to, a firm is unable to distribute a balance of client money in accordance with CASS 13.11.5R to the relevant client , it must attempt to transfer the balance to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022 and in accordance with CASS 13.9.4R . CASS 13.11.10B 02/08/2024 G (1) A firm may be unable to distribute a balance of client money in accordance with CASS 13.11.5R for reasons including that: (a) the firm is unable to trace the client ; or (b) despite the firm making enquiries, the relevant client has not provided the firm with instructions that would enable the firm to make a distribution. (2) Where the firm transfers a balance to a dormant asset fund operator under the applicable provisions of Part 1 of the Dormant Assets Act 2022 and in accordance with CASS 13.9.4R , it may cease to treat the balance as client money under CASS 13.9.2R(6) . (3) In attempting to transfer the balance to a dormant asset fund operator under CASS 13.11.10AR(2) , the firm should begin by seeking confirmation from the relevant dormant asset fund operator as to whether or not it would be in a position to accept the balance. Failure of an approved bank: secondary pooling event CASS 13.11.11 01/04/2019 R A secondary pooling event occurs on the failure of an approved bank at which a firm holds client money in a client bank account . CASS 13.11.12 01/04/2019 R (1) Subject to (2), if a secondary pooling event occurs as a result of the failure of an approved bank where one or more client bank accounts are held then in relation to every client bank account of the firm , the provisions of CASS 13.11.13R(1) , CASS 13.11.13R(2) and CASS 13.11.13R(3) will apply. (2) CASS 13.11.13R does not apply if, on the failure of the approved bank , the firm pays to its clients , or pays into a client bank account at an unaffected approved bank , an amount equal to the amount of client money that would have been held if a shortfall had not occurred as a result of the failure . CASS 13.11.13 01/04/2019 R Money held in each client bank account of the firm must be treated as pooled and: (1) any shortfall in client money held, or which should have been held, in client bank accounts , that has arisen as a result of the failure of the approved bank , must be borne by all customers whose client money is held in a client bank account of the firm , rateably in accordance with their entitlements to the pool; (2) a new client money entitlement must be calculated for each customer by the firm , to reflect the requirements in (1), and the firm’s records must be amended to reflect the reduced client money entitlement; (3) the firm must make and retain a record of each client’s share of the client money shortfall at the failed approved bank until the client is repaid; and (4) the firm must use the new client entitlements, calculated in accordance with (2), when performing the client money calculation in CASS 13.10.9R . CASS 13.11.14 01/04/2019 R The term “which should have been held” is a reference to the failed approved bank’s failure to hold the client money at the time of the pooling event. CASS 13.11.15 01/04/2019 R Any interest earned on client money following a primary or secondary pooling event will be due to clients in accordance with CASS 13.6.10R (Interest). CASS 13 Annex 1 CASS client bank account acknowledgement letter template CASS 13 Annex 1R 01/04/2019 R [Letterhead of firm subject to CASS 13.5.3R , including full name and address of firm ] [Name and address of approved bank ] [ Date ] Client Money Acknowledgment Letter (pursuant to the rules of the Financial Conduct Authority) We refer to the following [current/deposit account[s]] which [name of firm ], regulated by the Financial Conduct Authority (Firm Reference Number [FRN]), (“us”, “we” or “our”) has opened or will open with [name of approved bank ] (“you” or “your”): [Insert the account title[s], the account unique identifier[s] (for example, as relevant, sort code and account number) and (if applicable) any abbreviated name of the account[s] as reflected in the approved bank’s systems] ([collectively,] the “Client Bank Account[s]”). In relation to [each of] the Client Bank Account[s] identified above you acknowledge that we have notified you that: (a) we are under an obligation to keep money we hold belonging to our clients separate from our own money; (b) we have opened or will open the Client Bank Account for the purpose of depositing money with you on behalf of our clients; and (c) we hold all money standing to the credit of the Client Bank Account in our capacity as trustee under the laws applicable to us. In relation to [each of] the Client Bank Account[s] identified above you agree that: (d) you do not have any recourse or right against money in the Client Bank Account in respect of any sum owed to you, or owed to any third party, on any other account (including any account we use for our own money), and this means for example that you do not have any right to combine the Client Bank Account with any other account and any right of set-off or counterclaim against money in the Client Bank Account; (e) you will title, or have titled, the Client Bank Account as stated above and that such title is different to the title of any other account containing money that belongs to us or to any third party; and (f) you are required to release on demand all money standing to the credit of the Client Bank 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 for any properly incurred charges or liabilities owed to you on, and arising from the operation of, the Client Bank Account, provided that you have a contractual right to retain such money and that this right is notwithstanding (a) to (c) above and without breach of your agreement to (d) above. We acknowledge that: (g) you are not responsible for ensuring compliance by us with our own obligations, including as trustee, in respect of the Client Bank Account[s]. You and we agree that: (h) the terms of this letter will remain binding upon the parties, their successors and assigns, and, for the avoidance of doubt, regardless of any change in name of any party; (i) this letter supersedes and replaces any previous agreement between the parties in connection with the Client Bank Account[s], to the extent that such previous agreement is inconsistent with this letter; (j) in the event of any conflict between this letter and any other agreement between the parties in connection with the Client Bank Account[s], this letter agreement will prevail; (k) no variation to the terms of this letter will be effective unless it is in writing, signed by the parties and permitted under the rules of the Financial Conduct Authority; (l) this letter will be governed by the laws of [ insert appropriate jurisdiction ]; and (m) the courts of [ insert same jurisdiction as previous ] will have jurisdiction to settle any dispute or claim arising out of 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. We remind you that, pursuant to the rules of the Financial Conduct Authority, we are not allowed to use the Client Bank Account[s] to deposit any money belonging to our clients with you until you have acknowledged and agreed to the terms of this letter. For and on behalf of [name of firm ] x___________________________ Authorised Signatory Print Name: Title: ACKNOWLEDGED AND AGREED: For and on behalf of [name of approved bank ] x___________________________ Authorised Signatory Print Name: Title: Contact Information: [insert signatory’s phone number and email address] Date: CASS 13 Annex 2 Guidance notes for client bank account acknowledgement letters (CASS 13.5.5G) CASS 13 Annex 2G 01/04/2019 G Introduction 1. This annex contains guidance on the use of the template client bank account acknowledgement letters in CASS 13 Annex 1R . General 2. Under CASS 13.5.2R(2) , firms are required to have in place a duly signed and countersigned client bank account acknowledgement letter for a client bank account before they are allowed to hold or receive client money in or into the account. 3. For each client bank account a firm is required to complete, sign and send to the approved bank a client bank account acknowledgement letter identifying that account and in the form set out in CASS 13 Annex 1R (CASS claims management firm client bank account acknowledgment letter template). 4. When completing a client bank account acknowledgement letter using the appropriate template, a firm is reminded that it must not amend any of the text which is not in square brackets (acknowledgment letter fixed text). A firm should also not amend the non-italicised text that is in square brackets. It may remove or include square bracketed text from the letter, or replace bracketed and italicised text with the required information, in either case as appropriate. The notes below give further guidance on this. Clear identification of relevant accounts 5. A firm is reminded that for each client bank account it needs to have in place a client bank account acknowledgement letter . As a result, it is important that it is clear to which account or accounts each client bank account acknowledgement letter relates. As a result, the template in CASS 13 Annex 1R requires that the client bank account acknowledgement letter includes the full title and at least one unique identifier, such as a sort code and account number, deposit number or reference code, for each client bank account . 6. The title and unique identifiers included in a client bank account acknowledgement letter for a client bank account should be the same as those reflected in both the records of the firm and the relevant approved bank , as appropriate, for that account. Where an approved bank’s systems are not able to reflect the full title of an account, that title may be abbreviated to accommodate that system, provided that: (a) the account may continue to be appropriately identified in line with the requirements of CASS 13 (for example, ‘segregated’ may be shortened to ‘seg’, ‘account’ may be shortened to ‘acct’ etc); and (b) when completing a client bank account acknowledgement letter , such letter must include both the long and short versions of the account title. 7. A firm should ensure that all relevant account information is contained in the space provided in the body of the client bank account acknowledgement letter . Nothing should be appended to a client bank account acknowledgement letter . 8. In the space provided in the template letter for setting out the account title and unique identifiers for each relevant account/deposit, a firm may include the required information in the format of the following table: Full account title Unique identifier Title reflected in [ name of approved bank ] systems [ Claims Management Firm Client Bank Account ] [ 00-00-00 12345678 ] [ CM FIRM CLIENT A/C ] 9. Where a client bank account acknowledgement letter is intended to cover a range of client bank accounts , some of which may not exist as at the date the client bank account acknowledgement letter is countersigned by the approved bank , a firm should set out in the space provided in the body of the client bank account acknowledgement letter that it is intended to apply to all present and future accounts which: (a) are titled in a specified way (e.g. with the word ‘client’ in their title); and (b) which possess a common unique identifier or which may be clearly identified by a range of unique identifiers (e.g. all accounts numbered between XXXX1111 and ZZZZ9999). For example, in the space provided in the template letter in CASS 13 Annex 1R which allows a firm to include the account title and a unique identifier for each relevant account, a firm should include a statement to the following effect: Any account open at present or to be opened in the future which contains the term [‘client’][insert appropriate abbreviation of the term ‘client’ as agreed and to be reflected in the Approved Bank’s systems] in its title and which may be identified with [the following [insert common unique identifier]][an account number from and including [XXXX1111] to and including [ZZZZ9999]][clearly identify range of unique identifiers]. Signatures and countersignatures 10. A firm should ensure that each client bank account acknowledgement letter is signed and countersigned by all relevant parties and individuals (including where a firm or the approved bank may require more than one signatory). 11. A client bank account acknowledgement letter that is signed or countersigned electronically should not, for that reason alone, result in a breach of the rules in CASS 13.5 . However, where electronic signatures are used, a firm should consider whether, taking into account the governing law and choice of competent jurisdiction, it needs to ensure that the electronic signature and the certification by any person of such signature would be admissible as evidence in any legal proceedings in the relevant jurisdiction in relation to any question as to the authenticity or integrity of the signature or any associated communication. Completing a client bank account acknowledgment letter 12. A firm should use at least the same level of care and diligence when completing a client bank account acknowledgement letter as it would in managing its own commercial agreements. 13. A firm should ensure that each client bank account acknowledgement letter is legible (e.g. any handwritten details should be easy to read), produced on the firm’s own letter-headed paper, dated and addressed to the correct legal entity (e.g. where the approved bank belongs to a group of companies). 14. A firm should also ensure each client bank account acknowledgement letter includes all the required information (such as account names and numbers, the parties’ full names, addresses and contact information, and each signatory’s printed name and title). 15. A firm should similarly ensure that no square brackets remain in the text of each client bank account acknowledgement letter (e.g. after having removed or included square bracketed text, as appropriate, or having replaced square bracketed and italicised text with the required information as indicated in the template in CASS 13 Annex 1R ) and that each page of the letter is numbered. 16. A firm should complete a client bank account acknowledgement letter so that no part of the letter can be easily altered (e.g. the letter should be signed in ink rather than pencil). 17. In respect of the client bank account acknowledgement letter’s governing law and choice of competent jurisdiction (see paragraphs (11) and (12) of the template client bank account acknowledgement letters ), a firm should agree with the approved bank and reflect in the letter that the laws of a particular jurisdiction will govern the client bank account acknowledgement letter and that the courts of that same jurisdiction will have jurisdiction to settle any disputes arising out of, or in connection with, the client bank account acknowledgement letter , its subject matter or formation. 18. If a firm does not, in any client bank account acknowledgement letter , utilise the governing law and choice of competent jurisdiction that is the same as either or both: (a) the laws of the jurisdiction under which either the firm or the relevant approved bank are organised; or (b) as is found in the underlying agreement/s (e.g. banking services agreement) with the relevant approved bank ; then the firm should consider whether it is at risk of breaching CASS 13.5.4R(3) or CASS 13.4.2R . Authorised signatories 19.A firm is required under CASS 13.5.7R to use reasonable endeavours to ensure that any individual that has countersigned a client bank account acknowledgement letter returned to the firm was authorised to countersign the letter on behalf of the relevant approved bank . 20. If an individual that has countersigned a client bank account acknowledgement letter does not provide the firm with sufficient evidence of their authority to do so then the firm is expected to make appropriate enquiries to satisfy itself of that individual’s authority. 21. Evidence of an individual’s authority to countersign a client bank account acknowledgement letter may include a copy of the approved bank’s list of authorised signatories, a duly executed power of attorney, use of a company seal or bank stamp, and/or material verifying the title or position of the individual countersigning the client bank account acknowledgement letter . 22. A firm should ensure it obtains at least the same level of assurance over the authority of an individual to countersign the client bank account acknowledgement letter as the firm would seek when managing its own commercial arrangements. Third party administrators 23. If a firm uses a third party administrator (TPA) to carry out the administrative tasks of drafting, sending and processing a client bank account acknowledgement letter , the text “[Signed by [ Name of Third Party Administrator ] on behalf of [ firm ]]” should be inserted to confirm that the client bank account acknowledgement letter was signed by the TPA on behalf of the firm . 24. In these circumstances, the firm should first provide the TPA with the requisite authority (such as a power of attorney) before the TPA will be able to sign the client bank account acknowledgement letter on the firm’s behalf. A firm should also ensure that the client bank account acknowledgement letter continues to be drafted on letter-headed paper belonging to the firm . Client bank accounts 25. A firm must ensure that each of its client bank accounts follows the naming conventions prescribed in the Glossary . This includes ensuring that all client bank accounts include the term ‘client’ in their title or an appropriate abbreviation in circumstances where this is permitted by the Glossary definition. 26. All references to the term “Client Bank Account[s]” in a client bank account acknowledgement letter should also be made consistently in either the singular or plural, as appropriate. Previous Chapter Next Chapter Accessibility Terms & Conditions Privacy Policy Legal Information Sitemap Social Contact FCA Head Office 12 Endeavour Square London E20 1JN Contact us Is there anything wrong with this page? Copyright © 2025 FCA. All rights reserved. Back to top Company no. 01920623 Designed and Maintained by FinregE Limited | https://finreg-e.com | 2025-11-15T10:24:49.028741 | regulatory_text | UK | FCA | [] | 6 | 1 | 1 | 10,410 |
FCA Handbook | https://handbook.fca.org.uk/handbook/cocon1 | FCA Handbook - COCON 1 Application and purpose | cocon1 | Skip to Main Content This is the new version of the new [ORG] Handbook website. Help us improve it by giving your feedback . Home Latest News Published Date This Month Submit Reset FC[ORG] Handbook Select Timeline Track Changes View Chapter as PDF View Sourcebook as PDF Glossary Select Timeline Track Changes Filter by provision Submit Reset Instruments Made by last board Instrument Type Effective Date Last 7 Days Last 15 Days Last 30 Days Last 90 Days Published Date Last 30 Days Last 90 Days Last Year Filter by Module Submit Reset Forms Type Effective Date Last 7 Days Last 30 Days Last 90 Days Last Year Submit Reset Technical Standards Select Timeline Track Changes Level 3 Materials Filter by Dossier Submit Reset Advanced Search User Guides Video Guides Reader's Guide Navigation Guide Useful Links Search Guide Timeline Guide FAQ Handbook Archive Submit Reset Administrator External Users [ORG] Users Role List [ORG]MS Latest News Stage FCA Handbook Stage FCA Glossary Stage Instruments Stage Forms Stage Level 3 Materials Stage Technical Standards Stage [ORG]A Website Useful Links Advanced Search Help FC[ORG] Handbook in print SignUp / SignIn [ORG] Website PRA Rulebook Useful Links Contact Us Advanced Search Search Clear Home FCA Handbook COCON COCON 1 COCON 1 Application and purpose You are viewing COCON 1 Application and purpose as of 15/11/2025 . COCON 1 Application and purpose was last updated on 31/07/2023 . Future Versions: 01/09/2026 Guidance Rules Taxonomy COCON 1.1 Application COCON 1.1.1 03/07/2017 G Under section 64A of the Act , the [ORG] may make rules about the conduct of certain persons working in firms . To whom does it apply? COCON 1.1.1A 03/07/2017 R COCON applies to the persons set out in the table in COCON 1.1.2R . COCON 1.1.2 09/12/2020 R Table: To whom does COCON apply? Persons to whom COCON applies Comments (1) An SMF manager . (2) An employee (“P”) of an SMCR firm who: (a) performs the function of an SMF manager ; (b) is not an approved person to perform the function in question; and (c) is required to be an approved person at the time P performs that function. (3) An employee of an SMCR firm who would be performing an FCA-designated senior management function but for SUP 10C.3.13R (The 12-week rule). (4) A certification employee of an SMCR firm . This applies even if the certification employee has not been notified that COCON applies to them or notified of the rules that apply to them. (5) An employee of an SMCR firm who would be performing an FCA certification function but for SYSC 27.5.1R (Emergency appointments) or SYSC 27.5.3R (Temporary UK role). (6) Any employee of an SMCR firm not coming within another row of this table, except one listed in column (2) of this row (6) of this table. (A) This row (6) does not apply to an employee of an SMCR firm who only performs functions falling within the scope of the following roles: (a) receptionists; (b) switchboard operators; (c) post room staff; (d) reprographics/print room staff; (e) property/facilities management; (f) events management; (g) security guards; (h) invoice processing; (i) audio visual technicians; (j) vending machine staff; (k) medical staff; (l) archive records management; (m) drivers; (n) corporate social responsibility staff; (o) taking part in following activities of the firm : (i) the firm’s activities as a data controller; or (ii) the firm’s activities of data processing; as defined in the data protection legislation , but subject to Note (1) of this table; data protection legislation ; (p) cleaners; (q) catering staff; (r) personal assistant or secretary; (s) information technology support (ie, helpdesk); and (t) human resources administrators /processors. (C) This row (6) also does not apply to an employee of an SMCR firm that is an FCA-authorised person until 31 March 2021. (7) [deleted] (8) A board director of: a UK SMCR firm . Note (1) : A function is only within paragraph (o) of column (2) (Comments) of row (6) of this table if the function does not require the employee concerned to exercise a significant amount of discretion or judgment. COCON 1.1.2A 03/07/2017 R For Swiss general insurers , references in this sourcebook to parts of the PRA Rulebook for ‘Solvency II firms’ are to be read as references to the corresponding parts of the PRA Rulebook applying to large non-directive insurers . COCON 1.1.3 31/07/2023 R Rules 1 to 6 in COCON 2.1 apply to all conduct rules staff . COCON 1.1.4 10/12/2018 R (1) Rules SC1 to SC4 in COCON 2.2 apply to all senior conduct rules staff members (subject to (2)). (2) SC1 to SC3 in COCON 2.2 do not apply to a senior conduct rules staff member within paragraph (d) of the definition of senior conduct rules staff member (P) unless P also falls into paragraph (a) or (b) of that definition. COCON 1.1.5 10/12/2018 G (1) The guidance in COCON 2.3 applies to SMCR firms . (2) [deleted] (3) SYSC 27.6.3R provides that a function performed by a non-executive director of a firm acting as such is not an FCA certification function for that firm . COCON 1.1.5A 31/07/2023 R The conduct of a member of the conduct rules staff of a firm is not within the scope of Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers): (1) unless the corresponding COCON firm activities of the firm are within the scope of PRIN 3.1 (Who?) so far as it applies to Principle 12; and (2) except to the extent that Principle 12 applies to that firm under PRIN 3.1 . COCON 1.1.5B 31/07/2023 R (1) The restrictions of the scope of COCON in COCON 1.1.7AR to COCON 1.1.7ER (when they apply) are in addition to those in COCON 1.1.6R to COCON 1.1.7R . (2) The restrictions of the scope of COCON in COCON 1.1.7AR to COCON 1.1.7ER (when they apply) are cumulative. To what conduct does it apply? COCON 1.1.5C 31/07/2023 G (1) The effect of COCON 1.1.5BR(1) is that conduct that is within the scope of COCON 1.1.7AR to COCON 1.1.7ER but outside the scope of COCON 1.1.6R to COCON 1.1.7R is outside the scope of COCON and vice versa. (2) The effect of COCON 1.1.5BR(2) is that conduct of a member of the conduct rules staff of a firm : (a) is outside the scope of COCON even if it is excluded by only one of the rules in COCON 1.1.7AR to COCON 1.1.7ER ; and (b) is outside the scope of: (i) Rule 4 in COCON 2.1 (You must pay due regard to the interests of customers and treat them fairly) even if the only rule excluding it is COCON 1.1.7ER ; and (ii) Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers) even if the only rule excluding it is COCON 1.1.7CR . COCON 1.1.6 10/12/2018 R For a person (P) who is an approved person , COCON applies to the conduct of P in relation to the performance by P of functions relating to the carrying on of activities (whether or not regulated activities ) by the firm (Firm A) on whose application approval was given to P. [ Note: sections 64A(4) and (5)(a) of the Act (Rules of conduct)] COCON 1.1.6A 10/12/2018 R For a person (P) who is a board director of a firm (Firm A) but is not an approved person of Firm A, COCON applies to the conduct of P in relation to the performance by P of functions relating to the carrying on of activities (whether or not regulated activities ) by Firm A. [ Note: sections 64A(4) and (5)(ab) of the Act (Rules of conduct)] COCON 1.1.7 10/12/2018 R (1) For a person (P) subject to COCON who is not an approved person , COCON applies to the conduct of P in relation to the performance by P of functions relating to the carrying on of activities (whether or not regulated activities ) by P’s employer (Firm A). (2) This rule does not apply where COCON 1.1.6A applies. [ Note: sections 64A(4) and (5)(b) of the Act (Rules of conduct)] COCON 1.1.7-A 31/07/2023 R (1) The term “ COCON firm activities ” means (in relation to conduct of P in relation to Firm A) the corresponding activities of Firm A as referred to in COCON 1.1.6R to COCON 1.1.7R (To what conduct does it apply?). (2) A person is a member of the conduct rules staff of Firm A if they meet the description of P in relation to that firm in COCON 1.1.6R to COCON 1.1.7R . (3) The terms “P” and “Firm A” have the same meaning as they do in COCON 1.1.6R to COCON 1.1.7R . COCON 1.1.7A 31/07/2023 R (1) Where Firm A in COCON 1.1.6R to COCON 1.1.7R is an SMCR firm other than an SMCR banking firm , the application of COCON is further restricted by this rule . (2) COCON only applies to conduct that forms part of, or is for the purpose of, any of the following: (a) the SMCR financial activities of Firm A; or (b) any activities of Firm A that have, or might reasonably be regarded as likely to have, a negative effect on: (i) the integrity of the UK financial system ; or (ii) the ability of Firm A to meet the “fit and proper” test in threshold condition 2E and 3D (Suitability); or (iii) the ability of Firm A to meet the applicable requirements and standards under the regulatory system relating to Firm A’s financial resources. (3) This rule does not apply where COCON 1.1.7BR applies. (4) This rule does not apply to Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers). COCON 1.1.7B 07/12/2020 R (1) Where a member (M) of the conduct rules staff of Firm A as described in COCON 1.1.6R to COCON 1.1.7R meets the condition in (c) and Firm A meets the conditions in (a) and (b), the application of COCON to the conduct of M in relation to Firm A is further restricted by this rule : (a) the firm is a pure benchmark SMCR firm ; (b) the firm is an Annex II benchmark administrator (whether or not it also administers other benchmarks); and (c) M does not perform any functions described in COCON 1.1.6R to COCON 1.1.7R in relation to Firm A with respect to any benchmark that the firm administers except a benchmark that is subject to Annex II to the benchmarks regulation. (2) (a) The only conduct to which the following rules apply is the conduct described in (2)(b): (i) the rules in COCON 2.1 (Individual conduct rules); and (ii) rule SC4 in COCON 2.2 (You must disclose appropriately any information of which the FCA or PRA would reasonably expect notice). (b) The rules in (2)(a) apply only to any of the following: (i) the performance of a function by M in relation to the carrying on of a regulated activity by Firm A; (ii) (if M is an SMF manager ) the performance by M of a controlled function in relation to Firm A (whether or not approval has been sought and granted). (3) Rules SC1 to SC3 in COCON 2.2 (Senior manager conduct rules) apply only to conduct: (a) that comes within (2)(b); or (b) that comes within COCON 1.1.7AR , but this paragraph (3)(b) only applies in a prudential context . COCON 1.1.7C 31/07/2023 R The conduct of a member of the conduct rules staff of a firm is not within the scope of Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers) unless the corresponding COCON firm activities of the firm are within the scope of PRIN 3.2 (What?) so far as it applies to Principle 12. COCON 1.1.7D 31/07/2023 G The effect of COCON 1.1.7C is that a person’s conduct is not within the scope of Rule 6 in COCON 2.1 if the related activities of the firm fall outside the scope of Principle 12. If Principle 12 applies, Rule 6 in COCON 2.1 only applies if the conduct is also within the scope of the other relevant COCON application rules (although one of the COCON application rules ( COCON 1.1.7AR ) does not apply to Rule 6). COCON 1.1.7E 31/07/2023 R To the extent that Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers) applies to the conduct of a person , Rule 4 in COCON 2.1 (You must pay due regard to the interests of customers and treat them fairly) does not apply to that conduct of that person . COCON 1.1.8 31/07/2023 G (1) More than one of COCON 1.1.6R to COCON 1.1.7ER may apply to the same individual performing several roles. (2) For example, say that an individual (A) is an approved person for firm X and is employed by firm Y in a role that does not involve a controlled function or being a director. (3) COCON 1.1.6R applies to A’s role with firm X and COCON 1.1.7R applies to A’s role with firm Y. COCON 1.1.8A 07/12/2020 R (1) This rule applies to a person (P): (a) who is an approved person approved to perform a controlled function under SUP 10A (FCA Approved Persons in Appointed Representatives); (b) for whom P’s authorised approved person employer is an SMCR firm (F); and (c) to whom COCON also applies in P’s capacity as a member of F’s conduct rules staff . (2) COCON does not apply to conduct of P to the extent that: (a) that conduct relates to the performance by P of functions: (i) in (1)(a); or (ii) in relation to the carrying on of a regulated activity by the appointed representative concerned; and (b) APER applies to that conduct. Where does it apply? COCON 1.1.8B 31/07/2023 R The restrictions of the scope of COCON in COCON 1.1.9R to COCON 1.1.10R on the one hand and COCON 1.1.11C on the other are cumulative. COCON 1.1.9 10/12/2018 R (1) COCON applies to the conduct of conduct rules staff set out in (2) wherever it is performed. (2) This rule applies to: (a) a senior conduct rules staff member ; and (b) a certification employee performing FCA certification function (6) (material risk takers) in the table in SYSC 27.7.3R for a UK SMCR firm . COCON 1.1.9A 10/12/2018 G (1) This paragraph deals with how COCON 1.1.9R applies to a certification employee (P) who performs the material risk taker FCA certification function and another FCA certification function for the same UK SMCR firm . (2) If P’s conduct relates to both FCA certification functions (because for example those two functions cover the same activities) COCON applies without territorial limitation to P’s conduct. (3) If part of P’s conduct relates to the material risk taker FCA certification function and the rest of P’s conduct relates to the other FCA certification function , COCON only applies without territorial limitation to P’s conduct in relation to the material risk taker FCA certification function . COCON 1.1.10 10/12/2018 R (1) This rule applies to members of a firm’s conduct rules staff apart from conduct rules staff in COCON 1.1.9R . (2) Subject to (3), COCON only applies to the conduct of persons to whom this rule applies (as set out in (1)) if that conduct: (a) is performed from an establishment maintained in the United Kingdom by the SMCR firm ; or (b) involves dealing with a client of the firm in the United Kingdom from an establishment overseas. (3) Paragraph (2)(b) only applies to a UK SMCR firm . COCON 1.1.11 07/03/2016 G The FCA interprets the phrase ‘dealing with’ in COCON 1.1.10R as including having contact with customers and extending beyond ‘dealing’ as used in the phrase ‘dealing in investments’. ‘Dealing in’ is used in Schedule 2 to the Act to describe, in general terms, the regulated activities which are specified in Part II of the Regulated Activities Order . COCON 1.1.11A 07/03/2016 G The FCA interprets the phrase ‘a client of the firm in the United Kingdom ’ in COCON 1.1.10R as referring to: (1) for a client which is a body corporate, its office or branch in the United Kingdom ; or (2) for a client who is an individual, a client who is in the United Kingdom at the time of the dealing. COCON 1.1.11B 09/12/2019 G (1) The Regulated Activities Order has an effect on the territorial scope of COCON . (2) This is because whether or not conduct involves regulated activities may affect how and whether COCON applies. Therefore where overseas activities are excluded from being regulated activities by the Regulated Activities Order , that will have an effect on COCON . (3) An example of (1) is the territorial restriction relating to regulated claims management activities . (4) As explained in PERG 2.4A (Link between regulated claims management activities and Great Britain), a claims management activity specified in the Regulated Activities Order is only a regulated activity if it is carried on by way of business in Great Britain . (5) The result is that a claims management activity specified in the Regulated Activities Order carried on outside Great Britain is an unregulated activity for the purposes of COCON . (6) This restriction: (a) applies to conduct rules staff coming within COCON 1.1.9R as well as to other conduct rules staff ; and (b) applies in addition to the restriction in COCON 1.1.10R . COCON 1.1.11C 31/07/2023 R The conduct of a member of the conduct rules staff of a firm is not within the scope of Rule 6 in COCON 2.1 (You must act to deliver good outcomes for retail customers) unless the corresponding COCON firm activities of the firm are within the scope of PRIN 3.3 (Where?) so far as it applies to Principle 12. COCON 1.1.11D 31/07/2023 G The effect of COCON 1.1.8BR and COCON 1.1.11CR is that conduct of a member of a firm’s conduct rules staff is only within the territorial scope of Rule 6 in COCON 2.1 if it is within the scope of COCON 1.1.9R to COCON 1.1.10R and the corresponding activity of their firm is within the territorial scope of Principle 12 as set out in PRIN 3.3 . COCON 1.1.12 01/01/2021 R A person will not be subject to COCON to the extent that this would be contrary to the requirements of an EU measure passed or made before IP completion day , to the extent that those requirements continue to have effect after IP completion day under the EUWA . Purpose COCON 1.1.13 07/03/2016 G The purpose of this chapter is to set out rules for conduct rules staff and to provide guidance about those rules to firms whose staff are subject to them. COCON 1.1.14 03/07/2017 G COCON 1 Annex 1 has guidance on the role and responsibilities of non-executive directors to whom COCON applies. COCON 1.2 Investments COCON 1.2.1 07/03/2016 G COCON refers in a number of places to ‘ investments ’. The Glossary meaning of investment is wide and is not just limited to the ordinary dictionary meaning. COCON 1.2.2 07/03/2016 G Therefore, for example, an approved person performing controlled functions in a Solvency II firm or a small non-directive insurer should note that that term includes rights under a contract of insurance, meaning they should also take into account those parts of COCON which provide guidance on individual conduct rules that refer to ‘ investments ’. COCON 1.2.3 07/03/2016 G Where guidance refers to risks associated with investments , that will include risks applicable to rights under a contract of insurance including for example the risk of inadequate cover. COCON 1 Annex 1 Guidance on the role and responsibilities of non-executive directors of SMCR firms COCON 1 Annex 1 G 10/12/2018 G COCON 1 Introduction COCON 1.1 This annex applies to non-executive directors (NEDs) of an SMCR firm . COCON 1.2 This annex covers the role of a NED in performing the roles in (1) to (4), below: (1) the role of chair of the board of directors ; (2) the role of chair of the nomination committee; (3) the role of chair of any other committee (irrespective of whether performing that role is itself a designated senior management function ); (4) the general NED role. COCON 1.3 The FCA's view of the role of a NED is consistent with the duties of directors included in UK company law and the description of the role of a NED in the UK Corporate Governance Code . COCON 2 The general role of a NED COCON 2.1 The role of a NED performing the general NED role is to: (1) provide effective oversight and challenge; and (2) help develop proposals on strategy. COCON 2.2 To deliver this, their responsibilities include: (1) attending and contributing to board and committee meetings and discussions; (2) taking part in collective board and committee decisions, including voting and providing input and challenge; and (3) ensuring they are sufficiently and appropriately informed of the relevant matters prior to taking part in board or committee discussions and decisions. COCON 2.3 Other key roles of a NED include: (1) scrutinising the performance of management in meeting agreed goals and objectives; (2) monitoring the reporting of performance; (3) satisfying themselves on the integrity of financial information; (4) satisfying themselves that financial controls and systems of risk management are robust and defensible; (5) scrutinising the design and implementation of the remuneration policy; (6) providing objective views on resources, appointments and standards of conduct; and (7) being involved in succession planning. COCON 3 Role of a NED as chair of the board or a committee COCON 3.1 Subject to any specific governance arrangements, rules or requirements applicable to the board or particular committees, a NED’s responsibility as chair of the board or a committee includes: (1) ensuring that the board or committee meets with sufficient frequency; (2) fostering an open, inclusive discussion which challenges executives, where appropriate; (3) ensuring that the board or committee devotes sufficient time and attention to the matters within its remit; (4) helping to ensure that the board or committee and its members have the information necessary to its and their tasks; (5) reporting to the main board on the committee’s activities; (6) facilitating the running of the board or committee to assist it in providing independent oversight of executive decisions; and (7) in relation to the nomination committee, safeguarding the independence and overseeing the performance of the nomination committee. COCON 3.2 The chair of the nomination committee should take reasonable steps to ensure that the nomination committee complies with: (1) the requirements in SYSC 4.3A about the nomination committee (if that part of SYSC applies to the firm ); and (2) any specific and relevant requirements relating to the committee or to the matters within the committee’s responsibilities. COCON 3.3 Paragraph 3.2 of this annex is still relevant to a firm : (1) that is not required by the FCA Handbook to have a nomination committee; or (2) for which being the chair of such a committee is not a controlled function ; if it has such a committee. COCON 4 General approach to the role of a NED COCON 4.1 The FCA recognises that NEDs individually do not manage a firm's business in the same way as executive directors . Therefore, the responsibilities for which NEDs are accountable are likely to be more limited. COCON 4.2 A NED is neither required nor expected to assume executive responsibilities. COCON 4.3 Although NEDs who are subject to the senior management regime for SMF managers have individual duties under that regime, the FCA views the regime and its application as consistent with the principle of collective decision-making. COCON 4.4 The standard of care, skill and diligence that the FCA would expect from a NED is the care, skill and diligence that would be exercised by a reasonably diligent person with: (1) the general knowledge, skill and experience that may reasonably be expected of a person carrying out the functions carried out by the NED in relation to the firm, taking into account the standards in the Handbook (especially COCON and DEPP ); and (2) the general knowledge, skill and experience that the NED has. Previous Chapter Next Chapter Accessibility Terms & Conditions Privacy Policy Legal Information Sitemap Social Contact FCA Head Office 12 Endeavour Square London E20 1JN Contact us Is there anything wrong with this page? Copyright © 2025 FCA. All rights reserved. Back to top Company no. 01920623 Designed and Maintained by FinregE Limited | https://finreg-e.com | 2025-11-15T10:17:02.328530 | regulatory_text | UK | FCA | [] | 8 | 1 | 1 | 4,120 |
FCA Handbook | https://handbook.fca.org.uk/handbook/mcob9 | FCA Handbook - MCOB 9 Equity release: product disclosure | mcob9 | " Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve(...TRUNCATED) | 2025-11-15T10:22:20.294925 | regulatory_text | UK | FCA | [] | 7 | 1 | 1 | 30,156 |
FCA Handbook | https://handbook.fca.org.uk/handbook/cobs20 | FCA Handbook - COBS 20 With-profits | cobs20 | " Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve(...TRUNCATED) | 2025-11-15T10:20:17.783013 | regulatory_text | UK | FCA | [] | 10 | 0.971 | 0.914 | 16,130 |
FCA Handbook | https://handbook.fca.org.uk/handbook/cass7 | FCA Handbook - CASS 7 Client money rules | cass7 | " Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve(...TRUNCATED) | 2025-11-15T10:24:34.016502 | regulatory_text | UK | FCA | [] | 5 | 1 | 1 | 42,659 |
FCA Handbook | https://handbook.fca.org.uk/handbook/prod1 | FCA Handbook - PROD 1 Product Intervention and Product Governance Sourcebook (PROD) | prod1 | " Skip to Main Content This is the new version of the new [ORG] Handbook website. Help us improve i(...TRUNCATED) | 2025-11-15T10:26:48.926527 | regulatory_text | UK | FCA | [] | 8 | 1 | 1 | 3,349 |
FCA Handbook | https://handbook.fca.org.uk/handbook/mcob1 | FCA Handbook - MCOB 1 Application and purpose | mcob1 | " Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve(...TRUNCATED) | 2025-11-15T10:21:58.954569 | regulatory_text | UK | FCA | [] | 7 | 1 | 1 | 5,262 |
FCA Handbook | https://handbook.fca.org.uk/handbook/sysc23 | FCA Handbook - SYSC 23 Senior managers and certification regime: Introduction and classification | sysc23 | " Skip to Main Content This is the new version of the new FC[ORG] Handbook website. Help us improve(...TRUNCATED) | 2025-11-15T10:16:44.326447 | regulatory_text | UK | FCA | [] | 5 | 1 | 1 | 13,278 |
End of preview. Expand
in Data Studio
README.md exists but content is empty.
- Downloads last month
- 8