Chapter 4: Designation

Designation of third party collection accounts in the financial records of a fund service provider

  1. A fund service provider may hold investor money in an individually designated third party collection account e.g.,- “XYZ Ltd third party collection account Investment Fund A” or a pooled designated third party collection account(s) for all investment funds e.g.,- “XYZ Ltd third party collection account”.
  2. Where a fund service provider holds investor money in a pooled third party collection account, accounting segregation should be maintained. In its internal records, a fund service provider should maintain detailed and accurate records in order to identify how much each investor holds in that pooled third party collection account and movements in that balance.
  3. The designation in respect of a third party collection account requires the specific designation to be used with no variation permitted. The designation should be in the name field of the third party collection account and not in the address field.

    Designation of third party collection accounts in the financial records of a third party

  4. Where the third party collection accounts are designated in the financial records of a third party, the designation should be in the name field of the third party collection account and not in the address field or any other field within the third party’s financial records. If a third party has limited capacity to record the full title, an abbreviation such as “Coll a/c” is acceptable. The Central Bank expects the verification of the designation to take the form of a bank statement or other electronic form. A fund service provider may hold this verification electronically.
  5. The verification process should be followed each time a third party collection account is opened and not each time investor money is deposited in that particular third party collection account. Arising from Regulation 84(1), the fund service provider has up to three working days after the initial deposit of the money to withdraw the money if the third party collection account is not correctly designated. This process of designation verification is a separate process to what is required under Regulation 84(2)(b), which relates to ensuring that the third party collection account is set up in accordance with the provisions of the Investor Money Facilities Agreement.
  6. The Investor Money Facilities Agreement can be printed on the headed paper of the fund service provider of the third party, should be signed and dated by the third party and stamped with the third party’s official stamp. The Agreement should be reviewed annually and may need to be amended in the event of any change in the relationship between a fund service provider and the relevant third party. Where third party collection accounts are opened simultaneously (i.e. on the same day), one confirmation may be obtained but the fund service provider should ensure that the confirmation from the third party lists all applicable account numbers. This confirmation can be provided and received in electronic form.

Issued: 4 July 2023

Last revision: 4 July 2023