Bulk Transfer Initiative

The Bulk Transfer Initiative is an industry effort to prepare carrying broker dealers for an emergency mass transfer of large quantities of customer accounts and assets from a distressed broker to a financially secure broker.

• About the Bulk Transfer Initiative

  In 2018, DTCC and the broker community - with SIFMA leadership - collaborated on new guidelines to prepare the industry for an emergency mass transfer of customer accounts and assets from a distressed carrying broker (i.e., self-clearing, clears for others) to a financially secure broker, prior to the need for Securities Investor Protection Corporation (SIPC) intervention. This effort, referred to in the industry as “Bulk Transfer,” is intended to provide enhanced customer protection and to help ensure uninterrupted customer access to assets.

• Who is in-scope for a potential Bulk Transfer

  All eligible and qualified broker/dealers that carry customer accounts.

• Benefits

  • By creating a project playbook and standardization of data that will flow between brokers in a Bulk Transfer event, the industry has created a degree of predictability in a stressed situation, with the expectation that the movement of customer assets will be streamlined between brokers.
  • End customers will have access to their assets faster in the unlikely event that their carrying broker experiences material financial distress.
  • Firms can leverage centralized process and regulatory information to complete their own broker-dealer profile, which can save critical time during an emergency bulk transfer scenario.

• Bulk Transfer Stages

  The Bulk Transfer process is broken down into four stages:

  • Preparation - Firms begin preparation prior to a bulk transfer scenario. This includes identifying information detailed in the Broker/Dealer Profile and tailored communication templates.
  • Pre-Transfer - As part of a commercial agreement, a receiving firm will agree to acquire customer accounts and assets from a sending firm. Both will begin pre-transfer activities including implementation of governance framework, developing daily conversations with relevant regulators, coordination of stakeholder communications, unencumbering of customer assets, beginning of transfer execution activities, and sending standardized files to facilitate the transfer.
  • Transfer - During transfer of customer accounts and assets, both firms will continue to execute their respective transfer plans according to their respective governance frameworks. Firms will regularly communicate with regulators to ensure on-going compliance, execute remaining transfer activities and exchange any remaining standardized files.
  • Post-Transfer - Following the transfer of customer accounts and assets, the receiving firm must continue working with regulators to ensure compliance with relevant rules, and also continue to exchange optional standardized files to supplement any additional asset transfers.

  Preparation can and should occur well in advance of a bulk transfer. As outlined in the Bulk Transfer Playbook, specific asset transfer methods may vary depending on the asset type.

• For More Information

  To request additional information, please click here.

  
  
  

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