The company and its structure
Redmayne Bentley is very well capitalised, and has significant regulatory capital surpluses as can be seen in our MIFIDPRU 8 Public Disclosure available from https://www.redmayne.co.uk/information/public-disclosure.
Each quarter, we report the capital position of the firm to our regulator, the Financial Conduct Authority (FCA). We monitor regulatory requirements and take action to ensure we are not exposing the business, or our clients, to any unnecessary risks.
Oversight
Governance
Redmayne Bentley manages operational risk to client money and assets through its dedicated CASS and Risk teams and its Compliance department, all of which report to the firm’s CASS Committee.
The CASS Committee holds a remit to ensure FCA CASS rules are adhered to by the firm and to scrutinise any systems, policies, and processes relevant to the firm’s CASS arrangements.
The CASS Committee reports directly to the Main Board of the firm.
Training
All staff receive annual training on the requirements of the FCA CASS rules and how these rules affect their own roles. Minimum levels of Continuing Personal Development are set and monitored by the firm’s Learning and Development team.
Business Continuity
In accordance with regulatory requirements, each department and office within Redmayne Bentley must have a documented strategy for maintaining continuity of operations in the event of an unexpected disruption. This strategy is regularly tested to ensure it allows for a continual provision of customer service.
Reconciliations
In line with defined FCA rules, Redmayne Bentley conducts regular reconciliations of both client money and assets:
Internal Client Money Reconciliation: calculations which verify that our obligations to you and other clients are met by the amount of client money within our accounting records.
External Client Money Reconciliation: calculations which verify that the client money shown within our accounting records matches the money held within the firm’s client money bank accounts.
Internal Custody Reconciliation: a verification that our obligations to you and other clients are met by the safe custody asset records held by the firm.
External Custody Reconciliation: verification that the firm’s safe custody records are in harmony with the records of third parties where custody assets are held.
Physical Custody reconciliations: verification that the firm’s safe custody records match those assets held physically by the firm.
Our approach
As an FCA-regulated firm, Redmayne Bentley adheres to the rules and guidance prescribed by the FCA in selecting where client money or assets will be held. This is governed by the FCA’s Client Assets (CASS) rules established within their CASS sourcebook. With regard to cash balances, the FCA client money rules require Redmayne Bentley to deposit client money within client accounts held with banks, which meet the standards mandated under the rules and are clearly segregated from firm money.
Client Assets
The nominee company, Redmayne Nominees Limited, is used to hold client assets; no assets are held in the name of Redmayne Bentley LLP. This provides complete segregation and clarity of ownership.
In some cases, where it is not possible to use our nominee company to provide safe custody services, such as for non-UK securities, client assets may be registered, recorded and held under the name of a third party in another jurisdiction, which may also mean your assets are pooled with those of the third party’s other clients.
In the event of an insolvency of that third party, your assets could be treated in a different manner to that in which they would have been treated if they had been passed to an intermediate custodian, counterparty, intermediate broker, or settlement agent.
Client Money
Redmayne Bentley holds client money on your behalf in trust within banks or approved credit institutions as provided for within FCA rules, in an account clearly designated by the institution itself as a client money account and covered by an FCA Acknowledgment Letter.
These letters explain the legal terms applicable to the segregation and protection of client money and draw a clear distinction between it and the firm’s own money. Though an unlikely scenario, in the circumstance that Redmayne Bentley became insolvent, this letter ensures client money is held distinctly from the firm’s own money and is available to insolvency practitioners to repatriate to all clients who enjoy a valid claim on the client money balance.
We may deposit client money with a third party within the UK/EEA, selected in accordance with the FCA client asset rules. We may also deposit client money with a third party outside the UK/EEA. The legal and regulatory regime may be different from that of the UK, and if that institution fails, your money may be treated differently than in the UK.
Compensation Schemes
Redmayne Bentley participates in the Financial Services Compensation Scheme (FSCS); eligible investments are covered by the scheme up to £85,000, and cash deposits are separately covered under the Deposits Protection Scheme up to £85,000 per individual, per institution, in the event that the institution fails.
The FSCS may pay compensation equal to all or some of the claim if a firm is unable, or likely to be unable, to pay claims against it.
There are similar schemes in other jurisdictions, and you may be eligible for cover under these compensation schemes in the event of an insolvency situation.
Diversification of Client Money Deposits
We divide client money deposits between institutions and groups of institutions. We do this in order to better spread the risk of default by the institutions with whom they are held. Though this risk is not eliminated, the division of deposits functions as a substantial amelioration of the risk. The balance of monies held and their location are defined first by the FCA rules themselves and then by our own internal policy. The amount of money held, its location and any movement between third-party banks is monitored daily and reported on through the firm’s governance processes.
Due Diligence
The appointment and use of a third party, to provide custody or banking services to Redmayne Bentley with regard to client money and/or assets, involves the assessment of the suitability of that third party; considering elements such as credit ratings, expertise, and reputation.
Conducting regular due diligence on all banks and custodians that we have or seek to create a business relationship with enables us to verify our compliance with the FCA rules laid out within the CASS Sourcebook.
No money or assets are placed at institutions until due diligence has been carried out and approved.
Complaints
We take all complaints seriously and have in place established procedures for their fair and prompt handling, in line with FCA requirements. Our policy governing these procedures is available on request.
Complaints in respect of any Redmayne Bentley product or service should be addressed in the first instance to your Redmayne Bentley contact or office. Details of our internal complaints handling procedures are available at www.redmayne.co.uk/complaints or in hard copy on request.
The FCA rules require us to provide most individuals and some small businesses with a final response within eight weeks of the date the complaint was received. If a complaint is not resolved to your satisfaction, you may then contact the Financial Ombudsman (FOS), an independent dispute resolution scheme. Full details can be found on its website at http://www.financial-ombudsman.org.uk or by telephoning 0800 023 4567.
For more information about how we hold client assets and money, please refer to our Terms of Business at www.redmayne.co.uk/terms