client money protection
Terms & Conditions
Appendix iii: Clients’ Money Protection for Members administered by Barbon Insurance Group Limited T/A Let Alliance and insured by Hiscox Insurance Company Limited
UKALA have a Clients’ Money Protection scheme for its Members and the following shall only apply to Members who are registered under the UKALA Clients’ Money Protection Scheme. Members should refer to Appendix ii before reading this appendix.
The main purpose of Clients’ Money protection is to:
a. allow agents and property professionals to offer Clients’ Money protection; and
b. compensate the losses of the clients of a Member who suffer from the theft, misappropriation or insolvency of the Clients’ Money .
Members must meet all the following qualifying criteria:
a. have a shared client bank account covering all offices;
b. not have been refused or excluded membership of any other Clients’ Money protection scheme including ARLA, NALS, NAEA, UKALA, CMP and RICS; and
c. not have directors, owners or principal shareholders that have been associated with a business that has been removed from a Clients’ Money protection scheme or been convicted of any finance related criminal offence or have any criminal prosecutions pending.
a. agree to co-operate fully with any investigation by UKALA, The Insurers or their appointed representative;
b. agree to onsite visits to the addresses at which accounting records are held;
c. produce if necessary records and documents for inspection and allow UKALA or the Insurers or its representatives to review these documents;
d. have a working telephone;
e. have a working email address;
f. respond to communications when requested to do so;
g. make every reasonable effort to minimise any loss and take appropriate measures immediately if they are required to reduce any claim; and
h. give The Insurers all assistance which may reasonably be required to pursue recovery of amounts that may become liable to pay under this policy.
Failure of the above conditions may result in the Member being liable for an amount equal to the detriment suffered by The Insurers as a result of the Member’s failure to comply with these conditions.
4: Clients’ Money Handling
The Insurer bases their Clients’ Money criteria on the industry’s best practice for holding and accounting of Clients’ Money. Please refer to the UKALA Accounting Standard for further information.
a. have set up a separate bank account for Clients’ Money;
b. have the title of their Clients’ Money bank account easily distinguished from other accounts of their Business;
c. have in writing from their bank confirmation that all money is held by the Business as an agent;
d. have the banks written confirmation that the bank is not entitled to combine the Clients’ Money account(s) with any other account or to exercise any right of set-off or counterclaim against money in that accounting respect of any sum owed to it on any other account of the Business;
e. have and maintain systems and controls which enable you to monitor and manage Clients’ Money transactions and any credit risk arising;
f. have accounting systems and client data securely controlled and protected;
g. obtain client’s written approval to make payments from their accounts;
h. bank all Clients’ Money at the earliest reasonable opportunity;
i. nominate authorised staff to handle money;
j. ensure that records show any and all cash transactions;
k. reconcile client accounts together with bank and cash balances at regular intervals in order to demonstrate control over the accuracy and completeness of accounting records;
l. ensure there are always sufficient funds in the account to pay all amounts owing to clients; and
m. to pay amounts owing to clients as they fall due without delay.
5. Voluntary disclosure by the Principal, a Partner, Director or Company Secretary of a Member
If you are the Principal, a Partner, Director or Company Secretary of a Member and have recognised that there is a shortfall or potential misappropriation of Clients’ Money it is imperative that you disclose the issue to UKALA as soon as is reasonably possible. Disclosure may allow UKALA to provide guidance on steps the Business can take to resolve the issue. Failure to notify UKALA regarding a shortfall or potential misappropriation of Clients’ Money will result in cancellation of Membership.
6. Voluntary disclosure by an employee of a Member
If you are an employee of a Member (but not the Principal, a Partner, Director or Company Secretary) and have recognised that there is a shortfall or potential misappropriation of Clients’ Money you may request to speak to UKALA in confidence.
If you are contacting UKALA on behalf of the Principal, a Partner, Director or Company Secretary of a Member you are strongly advised to seek their authority to speak to UKALA in writing, before contacting UKALA.
If you are unable to seek the authority of the Principal, a Partner, Director or Company Secretary for whatever reason you are strongly advised to seek appropriate independent advice, before contacting UKALA.
a. The Insurer may use any information freely provided by a complainant or a Member in its consideration of a potential claim provided it is for the express purpose of dealing with that claim.
b. The Insurer may refuse to disclose information to either the complainant or the Member if in its reasonable opinion; it is not relevant to the consideration of the claim.
c. The Insurer will always consider any specific request for disclosure of information received from third parties such as the police or trading standards.
a. The Insurer will only investigate complaints relating to the theft of Clients’ Money and reserves the right to pass all other complaints to the relevant redress scheme or advise the complainant to go to court.
b. Decline complaints relating to a Clients’ Money dispute where such monies continue to be held securely by the Member.
c. Decline Clients’ Money complaints which relate to deposits protected by an authorised Tenancy Deposit Protection Scheme.
d. Decline any claim which occurred more than 12 months after the Business ceased to be a Member.
e. Decline any claim where the incident occurred more than 12 months prior to notification to UKALA.
f. Decline any claim where the loss occurred prior to the Member benefiting from UKALA Clients’ Money Protection.
g. where the insured event occurred more than 90 days after the UKALA member firm ceases to be a members or from the date they join another approved CMP scheme.
h. where the loss is covered by another insurance policy, for example PI policy.
i. Where the client money is still held in a protected client account.
j. where the insured event occurred more than 365 days before notification to UKALA
k. Where client money is subsequent to any insured event returned to the Client by the UKALA member firm.
l. where the loss between the UKALA member firm and the client started before the UKALA member firm was covered by the scheme.
m. which has been protected under any deposit protection service.
n. any claim, including arbitration, brought outside the the UK
o. arising from any deliberate criminal or fraudulent act or omission by the claimant
p. where your or our right of recovery is restricted by any contract. This restriction is generally in place to prevent clients waiving our rights to pursue others to get a claim repaid.
q. In excess of £5M In the aggregate in respect of all claims arising out of any financial institution failure (eg bank)
r. arising from war, terrorism, confiscation or nuclear risks.
9. Subrogation and Recoveries
On payment of a loss, the claimant shall subrogate to The Insurer all rights of recovery against the Member so that The Insurer can pursue the Member and any relevant person or entity. The claimant also agrees to co-operate with any legal process The Insurers engage in, including providing a witness statement and evidence of the loss.
10. Miscellaneous Provisions
The following miscellaneous provisions apply:
a. these requirements may need to be updated from time to time;
b. the Member agrees to abide by the latest version of the requirements notwithstanding any earlier version which were in force when joining UKALA;
c. The Insurer may delay action if The Insurer has any concerns about a Member’s compliance with these requirements, their identity, or any fraud or money laundering;
d. The Insurer and or UKALA cannot be held responsible for intervening events beyond their control which prevent, delay or impede The Insurer’s ability to operate the scheme or these requirements;
e. The Insurer and or UKALA will not be responsible for the Member missing an email from The Insurer and or UKALA when the message was received into the Member’s spam email inbox or suppressed by other security measures. The Member is responsible for adding the scheme email address to their ‘safe sender’ lists if necessary.
11. Questions about Clients’ Money Protection for UKALA members administered by Barbon Insurance Group Limited T/A Let Alliance and insured by Hiscox Insurance Company Limited
If you have any questions about the UKALA Clients’ Money Protection Scheme please contact UKALA:
UKALA Suite 2.03, 20 Midtown, 20 Proctor Street London, WC1V 6NX
020 7820 7900
Client money protection certificate
Client money protection certificate