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Financial Markets Conduct Act 2013

Licensing and other regulation of market services - Regulation of client money or property services - Obligations for handling client money and client property

431ZH: Protection of client money and client property held on trust

You could also call this:

"Your money and property are safe when someone looks after it for you."

Illustration for Financial Markets Conduct Act 2013

When you give money or property to a provider to hold on trust for you, it is protected. This means the provider cannot use it to pay their debts to other people. The provider's other creditors also cannot take the money or property to pay the provider's debts. You can find more information about this in section 431ZG. The provider can still claim money from you if they have a lawful reason to do so.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS465989.

Topics:
Money and consumer rights > Banking and loansMoney and consumer rights > Consumer protectionBusiness > Industry rules
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431ZG: Restrictions on use of client money and client property, or

"Rules for using money and things that belong to your clients"

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431ZI: Who is responsible for obligations, or

"Who's in charge of following the rules when someone does work for another business?"

Part 6Licensing and other regulation of market services
Regulation of client money or property services: Obligations for handling client money and client property

431ZHProtection of client money and client property held on trust

  1. The client money or client property that is received or held by a provider on trust for a client—

  2. is not available for the payment of the debts owing to any other creditor of the provider; and
    1. is not liable to be attached or taken in execution under the order or process of any court at the instance of another creditor of the provider.

      1. Nothing in section 431ZG or this section takes away or affects any lawful lien or claim that a provider who holds client money or client property has against the client money or client property.

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      Notes
      • Section 431ZH: inserted, on , by section 29 of the Financial Services Legislation Amendment Act 2019 (2019 No 8).