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Disclosure to customers in relation to moneys received on account of customers

Securities and Futures (Licensing and Conduct of Business) Regulations

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The holder of a capital markets services licence must, before depositing moneys received on account of a retail customer in a trust account mentioned in regulation 17, disclose in writing to the retail customer —(a)that the retail customer’s moneys will be held on behalf of the holder by, as the case may be —(i)a bank that holds a licence under section 7 or 79 of the Banking Act 1970;(ii)a merchant bank that holds a merchant bank licence, or is treated as having been granted a merchant bank licence, under the Banking Act 1970;(iii)a finance company licensed under the Finance Companies Act 1967; or(iv)a custodian outside Singapore which is licensed, registered or authorised to conduct banking business in the country or territory where the account is maintained;(b)that the holder may withdraw the retail customer’s moneys from the trust account and deposit the moneys with an approved clearing house, a recognised clearing house, a member of a clearing facility or a member of an organised market for any of the purposes specified in regulation 19;(c)whether or not the retail customer’s moneys will be deposited in a trust account together with, and commingled with, the moneys of the holder’s other customers;(d)if the retail customer’s moneys will be deposited in a trust account together with, and commingled with, the moneys of the holder’s other customers, the risks of such commingling;(e)the consequences for the retail customer’s moneys if the financial institution or custodian with which the trust account is maintained becomes insolvent;(f)the consequences for the retail customer’s moneys if the money is deposited with an approved clearing house, a recognised clearing house, a member of a clearing facility or a member of an organised market, and the approved clearing house, recognised clearing house, member of a clearing facility or member of an organised market becomes insolvent; and(g)if the trust account will be maintained with a custodian outside Singapore in accordance with regulation 17(2) —(i)the fact that the laws and practices relating to trust accounts in the jurisdiction under which the custodian is licensed, registered or authorised may be different from the laws and practices in Singapore relating to trust accounts; and(ii)the fact that any such differences may affect the ability of the customer to recover the funds deposited in the trust account.

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