Aggregate Accounts to Manage the Finance Amount for Engaging in Debt-Based Crowdfunding
| No: 42075986 | Date(g): 9/6/2021 | Date(h): 29/10/1442 | Status: In-Force |
Translated Document
Effective from 2021-06-09 - Jun 08 2021
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Based on the powers granted to SAMA under its Law issued by Royal Decree No. (M/36) dated 11/4/1442 H, and the Finance Companies Control Law issued by Royal Decree No. (M/51) dated 13/8/1433 H,
SAMA would like to emphasize to all debt crowd funding institutions on the importance of adhering to the Finance Companies Control Law, its implementing regulations, and the Rules for Engaging in Debt-Based Crowdfunding regarding aggregated accounts for managing financing value in debt crowdfunding institutions. In particular, the following must be observed:
| First: | Aggregated accounts in debt crowd funding institutions must be solely for managing financing value and should be kept separate from the crowd funding institution’s funds in independent accounts. |
| Second: | The account for participant funds in debt crowd funding institutions should be named "Financing Value Management Account – [Name of the Debt Crowd funding Institution]". |
| Third: | The debt crowd funding institution must notify SAMA when opening or closing aggregated accounts with banks operating in the Kingdom. |
| Fourth: | The debt crowd funding institution must establish written policies and controls related to the management and operation of aggregated accounts, including defining the powers and authorized personnel, while ensuring the following: |
| 1) | Implement multi-layered control based on risk assessments, including activating internal oversight functions. |
| 2) | Management of the aggregated account should be limited to authorized personnel as per the board-approved authorization matrix, with authorized individuals required to submit bi-monthly reports to senior management. |
| 3) | The aggregated account should not be linked to any financial liabilities or rights of the debt crowd funding institution. |
| Fifth: | The debt crowd funding institution must perform and document reconciliations to verify that the total value of debt crowd funding transactions matches the aggregated account balance at the bank. |
| Sixth: | The agreement for opening the aggregated account with the bank must reflect all regulatory requirements as stated in the Rules for Engaging in Debt-Based Crowdfunding, outlining the responsibilities of both the bank and the debt crowd funding institution regarding transactions on the aggregated account. |
Please review and act upon these guidelines from this date. SAMA should be provided with the procedures taken to review and amend all documents in accordance with the instructions above.