Overview

The Financial Services Authority (FSA) this week published Consultation Paper 10/9, which includes the following proposals for enhancing its Client Assets Sourcebook (CASS):

Prime brokerage agreements to include mandatory disclosure annex summarising rehypothecation provisions;

Daily reporting to be offered to all clients of UK-authorised prime brokers;

Intra-group client money deposits to be restricted to 20% of the firm's total client money held in client bank accounts;

Certain liens to be prohibited in custodian agreements;

New CASS oversight controlled function to be introduced; and

a new client money and assets return framework, CMAR, to be introduced.

The consultation closes on 30 June and a policy statement is expected to be published during the third quarter of 2010.

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