LPS 3-33 - R.R.S.P.'s Administered by Brokers on Behalf of Authorized Trustees [Rescinded]
1.1 This Local Policy Statement has been revised solely to conform with the Securities Act S.B.C. 1985 c.83 and the Regulations thereto. Other than consequential amendments, there have been no changes of a substantive nature to this policy. It becomes effective upon proclamation of the Act on February 1, 1987.
The Vancouver Stock Exchange Service Corp. ("Service Corp.") has satisfied the Commission that it has adequate facilities to act as agents for trust companies with respect to self-directed R.R.S.P.'s. Therefore, the Service Corp. may be used as a repository for securities required for self-directed R.R.S.P.'s by brokers. Trust companies may also wish to use the facilities of the Service Corp. as a repository. The Commission will not object to arrangements between brokers and authorized trustees for the proper administration of these R.R.S.P.'s, provided that certain safekeeping disposition and segregation requirements as outlined below are adhered to.
2.1 The physical control over self-directed R.R.S.P securities is maintained by designated employees of a broker or lodged with the Service Corp. in a "segregated" position.
2.2 The R.R.S.P. securities are kept separate from all other securities held by a broker and kept in safekeeping or lodged with the Service Corp., pursuant to a written agreement between the broker and the authorized trustee and not encumbered. Securities must be identified as being held in safekeeping for the client in the registrant's security position record, client's ledger and statement of account. Securities may only be released on an instruction from the client or authorized trustee.
2.3 The means, be it numerical code or otherwise, by which customer accounts that are self-directed R.R.S.P.'s are identified is clearly distinguishable from the manner of identifying other types of accounts and each account is itself identified as being that of the authorized trustee for the beneficial owner, each being named.
2.4 Cash received by the broker is transferred to the authorized trustee daily.
2.5 The agreement between the broker and the authorized trustee incorporates the protection afforded customers as set out in Section 2.2, and prohibits the brokers from using assets from the authorized trustee's R.R.S.P. account for the customer to pay claims the broker may have against that particular customer's non-R.R.S.P. accounts.
2.6 The broker undertakes to ensure that only qualified investments under the Income Tax Act are purchased.
2.7 Approval of the regulatory authority under which the authorized trustee operates has been obtained prior to putting the agreement in effect.
2.8 Approval of the self-regulatory organizations of which the brokers are members by audit jurisdiction, has been obtained prior to putting the agreement into effect.
2.9 The National Contingency Fund is advised in writing by the broker prior to entering into the arrangement to act as agent for a trustee.
DATED at Vancouver, B.C. this ________ day of ______________ 19 ___.
B.C. Securities Commission