Regulation 16

must, before opening the trust account, assess, and satisfy itself of, the suitability of the safeguarding institution with respect to the depositing of the relevant money in a trust account opened with the safeguarding institution;

must, before depositing the relevant money in the trust account —

give written notice to the safeguarding institution and obtain an acknowledgment from the safeguarding institution that —

all moneys deposited in the trust account will be held on trust by the major payment institution or licensee for its customer and the safeguarding institution cannot exercise any right of set‑off against the moneys for any debt owed by the major payment institution or licensee to the safeguarding institution; and

the account is designated as a trust account, or a customer’s or customers’ account, which is distinguishable and maintained separately from any other account maintained with the safeguarding institution in which the major payment institution or licensee deposits its own moneys; and

disclose in writing to its customer —

that the customer’s relevant money will be held by the major payment institution or licensee on behalf of the customer in a trust account opened with the safeguarding institution;

whether or not the relevant money received from the customer will be deposited in a trust account together with, and commingled with, the relevant money received by the major payment institution or licensee from its other customers;

if the relevant money received from the customer will be deposited in a trust account together with, and commingled with, the relevant money received by the major payment institution or licensee from its other customers, the risks of the commingling; and

the consequences for the customer in respect of the relevant money if the safeguarding institution becomes insolvent;

must —

treat and deal with all the relevant money received from a customer as belonging to the customer; and

deposit all the relevant money in the trust account;

subject to paragraph (2), must not commingle the relevant money with other moneys;

must assess, and satisfy itself of, the suitability of the safeguarding institution with respect to the depositing of the relevant money in the trust account maintained with the safeguarding institution, on an annual basis subsequent to the depositing of the relevant money;

must keep, for a period of 5 years or longer, records of the grounds on which the major payment institution or licensee satisfied itself of the safeguarding institution’s suitability under sub‑paragraph (a) or (e); and

subject to paragraph (3), must not withdraw any money that is deposited in the trust account.

deposit the relevant money of a customer in a trust account together with, and commingled with, the relevant money received from its other customers;

advance money to the trust account from its own money to open the trust account; or

from time to time, advance money to the trust account from its own money to maintain the trust account.

the withdrawal of the money will not reduce the amount of the relevant money that is deposited and safeguarded in the trust account;

the money is for the purpose of reimbursing the major payment institution or licensee for money that the major payment institution or licensee has advanced to the trust account from its own money to open or maintain the trust account; or

the withdrawal of the money (whether or not it is money that belongs to the major payment institution or licensee) is for the purpose of payment to the customer.

the person is a bank that holds a licence granted under section 7 or 79 of the Banking Act 1970;

the person is 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; or

the person is a finance company licensed under the Finance Companies Act 1967.