| 1. |
VASPs must have in place the necessary policies, systems and controls, appropriate to the nature and scale of their operations, to ensure compliance with this Part IV of this Compliance and Risk Management Rulebook. |
| 2. |
VASPs holding Client Money must hold it on trust for their clients in a Client Account. |
| 3. |
All Client Accounts must include the words “Client Account” in their title. |
| 4. |
VASPs must have systems and controls to ensure that the Client Money is identifiable and secure at all times. |
| 5. |
Where a VASP holds or controls Client Money it must ensure—
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a. |
except where otherwise provided in Rule IV.A.6 of this Compliance and Risk Management Rulebook, that the Client Money is paid into a Client Account within one [1] calendar day of receipt; |
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b. |
Client Money held or controlled on behalf of clients in the UAE is paid into Client Accounts maintained with Third-Party Banks in the UAE; and |
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c. |
Client Money held or controlled on behalf of clients outside of the UAE may be deposited into Client Accounts with Third-Party Banks outside of the UAE but must be moved to, and maintained with, Third-Party Banks in the UAE and VASPs must initiate such moves within twenty-four [24] hours of receipt.
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| 6. |
The requirement for a VASP to pay Client Money into a Client Account does not, subject to Rule IV.A.7 of this Compliance and Risk Management Rulebook, apply with respect to such Client Money—
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a. |
temporarily held by the VASP before forwarding to an Entity nominated by the client; |
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b. |
in connection with a delivery versus payment transaction where—
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i. |
in respect of a client purchase, Client Money from the client will be due to the VASP within one [1] calendar day upon the fulfilment of a delivery obligation; or |
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ii. |
in respect of a client sale, Client Money will be due to the client within one [1] calendar day following the client’s fulfilment of a delivery obligation; or |
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iii. |
held in the client’s own name where the VASP has a mandate to manage the Client Money on a discretionary basis.
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| 7. |
VASPs must pay Client Money of the type described in Rule IV.A.6.b of this Compliance and Risk Management Rulebook into a Client Account where they have not fulfilled their delivery or payment obligation within three [3] calendar days of receipt of the Client Money. |
| 8. |
VASPs must maintain adequate records of all payments of Client Money received including, in respect of each payment, the—
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a. |
date of receipt; |
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b. |
name and unique identifier of the client for whom payment is to be credited; |
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c. |
name of the Entity who made the payment; |
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d. |
transaction identifier and/or reference; and |
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e. |
date when the payment was presented to the VASP’s Third-Party Bank.
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| 9. |
Payment into Client Accounts.
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a. |
VASPs must maintain systems and controls for identifying money which must not be in a Client Account and for transferring it without delay. |
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b. |
VASPs must not hold or deposit their own money into a Client Account, except where—
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i. |
it is a minimum sum required to open the account, or to keep it open; |
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ii. |
the money is received by way of mixed remittance, provided the VASP transfers out that part of the payment which is not Client Money within one [1] calendar day of the day on which the VASP would normally expect the remittance to be cleared; |
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iii. |
interest credited to the account exceeds the amount payable to clients, as applicable, provided that the money is removed within twenty [20] calendar days; or |
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iv. |
it is to meet a temporary shortfall in Client Money.
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| 10. |
Payment out of Client Accounts.
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a. |
VASPs must have procedures for ensuring all withdrawals from a Client Account are authorised. |
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b. |
Client Money must remain in a Client Account until it is—
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i. |
due and payable to the VASP; |
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ii. |
paid to the client on whose behalf the Client Money is held; |
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iii. |
paid in accordance with a client’s instruction on whose behalf the Client Money is held; |
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iv. |
required to meet the payment obligations of the client on whose behalf the Client Money is held; or |
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v. |
paid out in circumstances that are otherwise authorised by VARA.
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c. |
VASPs must not use Client Money belonging to one client to satisfy an obligation owed to another client, nor for any other obligation owed to other Entities [including but not limited to for liquidity, capital ratios or their own balance sheet purposes].
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d. |
VASPs must have a system for ensuring no off-setting or debit balances occur in Client Accounts.
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