Investment Business Amendment Act 2001

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Insurance Amendment Act 2001


2001 : 1


[Date of Assent 9 March 2001]

[Operative Date 9 March 2001]

WHEREAS It is expedient to amend the Investment Business Act 1998:

Be it enacted by The Queen's Most Excellent Majesty, by and
with the advice and consent of the Senate and the House of Assembly of
Bermuda, and by the authority of the same, as follows:

Short title
1 This Act may be cited as the Investment Business Amendment
Act 2001.

2 In this Act, "the principal Act" means the Investment Business
Act 1998.

New section 17A inserted in principal Act
3 The principal Act is amended by inserting the following section
after section 17

"Clients' money
17A (1) The Minister may, after consultation with the Authority,
make regulations with respect to money (in this section referred



to as 'clients' money') which investment providers hold in such
circumstances as are specified in the regulations.

(2) Without prejudice to the generality of subsection (1),
regulations under this section may

(a) provide that clients' money held by an investment
provider is held on trust ;

(b) require clients' money to be paid into an account the
title of which contains the word 'client' and which is with
an institution of a kind specified in the regulations;

(c) make provision with respect to the opening and keeping
of clients' accounts, including provision as to the
circumstances in which money other than clients' money
may be paid into such accounts and the circumstances
in which and the persons to whom money held in such
accounts may be paid out;

(d) require the keeping of accounts and records in respect of
clients' money;

(e) require any such accounts to be examined by an
approved auditor and require such auditor to report to
the Authority whether in his opinion the provisions of
the regulations have been complied with and on such
other matters as may be specified in the regulations;

(f) authorise the retention, to such extent and in such
cases as may be specified in the regulations, of so much
of clients' money as represents interest.

(3) An institution with which an account is kept in
pursuance of regulations made under this section does not incur
any liability as constructive trustee where money is wrongfully
paid from the account unless the institution permits the

(a) in the knowledge that it is wrongful to do so; or

(b) having deliberately failed to make enquiries in
circumstances in which a reasonable and honest person
would have done so.

(4) In this section, "institution" means an institution within
the meaning of the Banks and Deposit Companies Act 1999.".