Examples of Rule 17f-7 in a sentence
The information provided in response to the questionnaire will be used by the member banks of the Association in compiling Rule 17f-7 risk analyses and may also be furnished by members to U.S. investment companies.
Rule 17f-7 and amended Rule 17f-5 under the Investment Company Act (1940) provide for the placement of registered management investment company assets with custodians outside the U.S. The rules establish basic standards for foreign depositories that funds may use and generally require that a fund’s contract with its global custodian obligate the custodian to analyze and monitor the “custody risks of using a depository”.
As described above, Association members have regulatory obligations, pursuant to Rule 17f-7, to make eligibility determinations and to provide their investment company clients with information concerning depository risk.
A key requirement of Rule 17f-7 is that an investment company must receive from its “Primary Custodian” an analysis of the custody risks associated with maintaining assets with each depository it uses.
Each Association member will then decide for itself how to use that information in preparing a risk analysis under Rule 17f-7 or for other purposes.