The International Organization of Securities Commissions (IOSCO) today published a consultation report on Recommendations Regarding the Protection of Client Assets, which seeks to help regulators improve the supervision of intermediaries holding client assets.
Recent events such as the Lehman Brothers and MF Global insolvencies have highlighted the importance of client asset protection regimes. In this context, investors are trying to better understand the potential implications of placing their assets with particular intermediaries and in certain jurisdictions. Regulators are seeking to address risks to client assets and determine how to transfer or return client assets in default, resolution or insolvency scenarios.
The nine principles published today provide guidance to regulators on how to enhance their supervision of intermediaries holding client assets by clarifying the roles of the intermediary and the regulator in protecting those assets.