| China securities market is a developing market and it did not pay attention to the safety of clients' capital at the development beginning stage.By the early 2003, the activity of misappropriation of clients' deposit was broken out completely due to market continue downturn,and the activity caused 31 security companies imposed sanctions of shut down,bankruptcy or taken over by government.Evenly, investors did not have confidence to security industry.Hence,the safety of clients' assets is not only directly related to investors benefit but also related to the whole industry going concern.Clients' assets safety is protected by policy not only, furthermore,it is protected from building a comprehensive assets supervising mechanism.This article introduces clients' assets custody policies between China and international countries firstly.Secondly,it analyzes to the model of clients' deposit clearance system in China and demonstrates how it develops from security firm custody of clients' assets to third-party custody of clients' assets in details.Also,it researches to the background for each custody model and the problems of it.It analyzes the pre-condition of misappropriation of clients' deposit,the reason why have misappropriation of clients' deposit in place and solution to misappropriation of clients' deposit.Thirdly,the article performs case analysis by using the case of The United Securities Firm third-party custody of clients' assets proposal and analyzes its overall structure and business process.Finally,the article concludes that The United Securities Firm can implement four key strategies to setup clients' assets custody mechanism,namely security firm internal control,third-party custody by bank,clients self custody and CSRC monitoring. |
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