Client Asset Sourcebook (CASS) Resolution
The Formal Definition
A rigorous, mandatory regulatory governance framework enforced by the UK Financial Conduct Authority (FCA CASS 7 rules) requiring authorized investment firms to maintain ring-fenced client money bank accounts, conduct daily internal reconciliations, and maintain an updated resolution pack to guarantee complete asset recovery in the event of firm insolvency.
Mandatory Daily Reconciliation: Segregated Trust Bank Account Total ≡ ∑ Individual Client Money Obligations (Variance ≡ $0)
Cole Barrett's Reality Check
The Unvarnished Bottom Line"CASS rules are the reason you can sleep soundly at night when using an FCA-regulated UK broker. Under CASS, the broker cannot treat your money as their own. If the broker’s business implodes tomorrow, an administrator can open their CASS resolution pack and clearly see that your money is held in a ring-fenced trust, protected from corporate creditors."
Interactive Simulator: Test the Math
Real-World Example: Scenario Breakdown
Examining the real numbers for: Custody safety audit of a UK retail brokerage holding £100,000,000 in customer cash during an unexpected corporate insolvency
| Execution Metric | Fully Compliant CASS 7 UK Broker | Unregulated Offshore Custodian |
|---|---|---|
| Fee / Rate | Transparent platform fee | 'Zero-fee' platform |
| Spread / Buffer | Conducted daily internal reconciliations; client cash deposited into ring-fenced statutory trust accounts at Barclays and HSBC | Operated without statutory CASS segregation rules; commingled client funds into general operational accounts |
| Execution / Status | Maintained an updated digital CASS Resolution Pack with daily auditing oversight | Zero independent daily reconciliation audits; used client deposits to finance corporate business expansion |
| Total Cost / Result | Zero losses of segregated client assets | Investors lost their capital in corporate liquidation proceedings |
How Brokers Weaponize This Term
If you are trading with a UK-regulated broker, search the FCA register for their CASS compliance status. If a firm has been fined by the FCA for 'CASS breaches', it means their back office failed to properly segregate client money from firm capital.
Broker Evaluation Matrix
Cole Approves
Trading 212: Operates under strict FCA CASS rules in the UK, maintaining ring-fenced client trust accounts with top-tier global banks.
Read Audit →Cole Flags / Avoids
Offshore CFD Clones: Operates from jurisdictions without strict CASS rules, allowing them to legally commingle client money with corporate funds.
View Trap Details →Frequently Asked Questions
What is a CASS Resolution Pack?
It's a standardized legal and financial document pack that an FCA-regulated firm must keep updated at all times, allowing insolvency administrators to quickly identify and return client assets without lengthy delays.
Does CASS cover non-cash assets like stocks and ETFs?
Yes. CASS covers both client money (CASS 7) and client custody assets like shares and bonds (CASS 6), requiring safe third-party custody for both.