The Automated Customer Account Transfer Service (ACATS) is a central processing system that provides for the timely transfer of customer accounts among participant financial institutions, including banks and broker/dealers.

Overview

The Automated Customer Account Transfer Service (ACATS) is a system that automates and standardizes procedures for the transfer of assets in a customer account from one brokerage firm and/or bank to another.

ACATS can expedite account transfers by permitting transfers to be accomplished in an automated environment. NSCC developed ACATS in conjunction with the NYSE, its Rule 412 Task Force Committee and the NASD to address the industry's need to reduce delays and inconsistencies associated with manual processing.

Instruments handled by the system include equities, corporate and municipal bonds, unit investment trusts, mutual funds, options, cash and other investment products.

Who Can Use the Service

All eligible and qualified NSCC settling members and DTC member banks are eligible for this service.

Benefits

ACATS facilitates accurate and timely transfer of a customer's account, with the following operational advantages to users:

• Uniform time frames, standardized reporting and automated control functions
• The service debits delivering brokers the full market value of customers' securities, promoting the timely transfer of assets. For account transfers where a bank is the contra side, the assets are delivered free
• ACATS requires the customer's Social Security/Tax Identification Numbers to enhance the ability of firms to identify individual accounts
• ACATS provides an automated transfer initiation procedure that incorporates the industry's effort to immobilize paper documents such as Transfer Initiation Forms (TIFs)
• Automated residual credit processing allows credits that accumulate after a transfer is completed, such as stock or cash dividends, to be transferred electronically from the delivering firm to the receiving firm through ACATS
• Through the ACATS-Fund/SERV link, users can easily re-register customers' mutual fund assets
• Automated reclaims, partial transfers and fail reversals are available on a next-day settlement basis

How the Service Works

Customers initiate account transfers by submitting completed TIFs to their new broker or bank (in the case of residual credits and other non-standard transfers, the delivering firm initiates the transfer). The TIF data is forwarded to NSCC, which assigns control numbers and sends control reports to both delivering and receiving brokers/banks.

Delivering brokers/banks must submit asset details or reject the transfer. Assets that are submitted are reported to the delivering and receiving firms. Receiving firms have one business day to reject the account, or request that the delivering firm make adjustments. During this one-day period, the delivering firm can add, delete or change an item. Receivers can also delete mutual funds where they don't have a selling agreement with the fund.

Securities eligible for the Continuous Net Settlement (CNS) System are automatically routed into CNS, unless the delivering firm indicates otherwise. Other securities are transferred through ACATS receive and deliver instructions or sent to DTC, if non-CNS, DTC-eligible. Eligible mutual fund assets can be transferred through the automated ACATS-Fund/SERV interface. Options are routed to the Options Clearing Corporation, where transfers in customer options positions take place.

On settlement date, for non-CNS eligible securities, NSCC automatically debits the delivering broker with the value of the assets being transferred through ACATS and credits the receiving broker with the same amount. For assets that are delivered through NSCC's physical delivery systems, NSCC will credit the delivering broker with the value of those assets and debit a corresponding amount to the receiving broker.

For More Information

Please call Relationship Management at 1.888.382.2721.