What is a confirmation of custody?

Reception of safekeeping is a statement of a financial institution that confirms that it holds the assets for custody and will maintain them separately from other assets and return them on request. Safe services are available from many financial institutions, usually for a fee, because these assets cannot use in investment activities and therefore have no way to generate profits. The income of safekeeping should be deposited in a safe location as it provides a legal record of deposit. When receiving the safekeeping of the financial institution, it suggests that these assets hold on behalf of the owner, do not consider them part of its own assets and cannot use them in financial activities. It also recognizes responsibility for the return of these assets on request. With something as a safe deposit where the institution does not know the content, confirmation of the safekeeping may include liability release ;; If something is damaged in the transfer mailbox, the bank is not responsible because it could not check the content.

This document creates a trust obligation by the institution. He is responsible for adequate steps to protect assets in the warehouse. They may include the use of security measures, unique identification codes to avoid unauthorized access and other steps recommended and practiced by industry. If the institution is unable to protect assets, it can be considered legally responsible and may be sued for damages to replace the assets or compensate the owner for lost value.

As long as the assets are in custody, the owner should leave the confirmation. It is advisable to keep income that documented deposits, assets in custody and similar financial activities in one place. If the owner dies, it will make it easier to locate all its assets and make sure they count as part of the estate. The intake of safekeeping may also be important in the event of death, because the institution may want to see it, along with a death certificate to release assets.

If the financial institutionE does not automatically provide custody, the customer can apply for it. It is also possible to apply for a duplicate or substitute copy. The institution may charge a fee for this. When banks sell or merge with others, it should convert all assets in a safeguard. Customers should receive a new property notice with new contact information.