Client account is not a banking facility

Topic preview

1. 01

   Proper purpose only

   A firm receives money into client account because the client wants it held there until next month. Is that a proper use of client account, or a banking-facility use? Give the rule in one sentence.

2. 02

   Consent is not enough

   If the client expressly agrees to the money being held in client account for convenience, does that make the use acceptable? Say yes or no, then explain why.

3. 03

   Legitimate holding example

   Give one example of a proper legal purpose for money to pass through client account, and one example of an improper parking arrangement.

4. 04

   Parking money warning

   What warning sign tells you the firm may be using client account like a bank rather than for a transaction? State the sign and the risk in one breath.

5. 05

   Misuse not cured later

   If the money is later paid out correctly, does that automatically fix the earlier misuse of client account? Explain the answer briefly.

6. 06

   Stop parking money

   You identify that client account is being used to park money. What immediate correction would you expect the firm to make?

7. 1 more building block

   The full topic unlocks with FLK2 Playbook, including the remaining prompts and answer-key marking.