Clifford Chance
FSA prohibition on custody liens over client assets
12 August 2011
On 1 March 2011 the UK Financial Services Authority (FSA) published a new rule in its
Client Assets Sourcebook (CASS 6.3.5R), which requires a UK firm that holds
securities on behalf of its underlying clients (a “Firm”) to ensure that any third party
custodian with which the assets are deposited does not take a lien or right of sale
over those assets, subject to certain exceptions. The rule applies irrespective of the
location of the custodian.
