Q&As

Do debt collection firms need specific Financial Conduct Authority authorisation to collect client money?

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Published on LexisPSL on 18/04/2017

The following Financial Services Q&A provides comprehensive and up to date legal information covering:

  • Do debt collection firms need specific Financial Conduct Authority authorisation to collect client money?

Do debt collection firms need specific Financial Conduct Authority authorisation to collect client money?

For the purposes of this Q&A, we presume that the debt collection firm has been instructed by the Financial Conduct Authority (FCA) authorised investment firm to obtain money from a customer of the investment firm because of monies due and owed to the investment firm. We also presume that the investment firm is holding client money belonging to the customer in a client bank account.

The treatment and application of FCA client money rules are set out in Chapter 7 of the Client Assets Sourcebook (CASS 7). In particular, CASS 7.11 rules contain a variety of circumstances in which money will become, or will cease to remain client money.

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