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4000 - Advisory Opinions

Fiduciary Records as Disclosure Requirements for Insurance Coverage


October 19, 1987

Walter P. Doyle, Counsel

Thank you for your September 25 letter inquiring whether the following disclosure on the deposit account records of a domestic office of an FDIC-insured bank would satisfy the disclosure requirement of 12 C.F.R. § 330.1(b)(1) where several tiers of fiduciaries may be involved in holding, at such domestic office, the deposits generated by the clearance system for internationally-traded securities described in your letter:

"***, as depositary for the ***, which acts in a representative capacity for its participants some of whom, in turn, may act in a representative capacity for other agents, nominees, custodians, sub-agents or principals."

Assuming that the records of the fiduciaries at all levels, when taken together, identify the actual ownership interests in the deposit funds as of the date the bank is closed, we confirm that the amount of such deposit accounts then attributable, pursuant to such records, to each such owner will be separately insured by the FDIC up to the limit set forth in 12 C.F.R. § 330.2(b), and the records of each person or entity acting in a representative capacity will be sufficient evidence of ownership of the principal for purposes of determining insurance coverage, provided that such records are maintained in good faith and in the regular course of business.

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