The Government of Canada has made important changes to the rules governing deposit insurance protection for deposits held “in trust” at CDIC member institutions. The changes take effect on April 30, 2022 and impact certain trustees who hold deposits in trust for clients in a professional capacity. Please check back here regularly for updates about professional trustees and trust deposits.
It’s important to note that not all trustees are Professional Trustees. Only trustees who meet the following definition under the CDIC Act are Professional Trustees:
A Professional trustee means any of the following who is not a nominee broker:
- (a) the public trustee of a province or a similar public official whose duties involve holding moneys in trust for others;
- (b) a federal, provincial or municipal government, or a department or agency of such a government;
- (c) a lawyer or partnership of lawyers, a law corporation, or a notary or partnership of notaries in the province of Quebec, when they act in that capacity as a trustee of moneys for others;
- (d) a person who is acting as a trustee of moneys for others in the course of business and is required by or under a statute to hold the deposit in trust;
- (e) a person who is acting as a trustee of moneys for others in the course of business and is subject to the rules of a securities commission, stock exchange or other regulatory or self-regulating organization that audits compliance with those rules; or
- (f) a regulated federal or provincial trust company acting in the capacity of a depositor.
Not sure if you hold funds in a professional capacity? Please use the Trustee Decision Tree to find out:
Infographic – Trustee Decision Tree (Download PDF – 150 KB)
Rules for Trustees:
Please refer to the questions below if you are a Professional Trustee and wish to know more about the new rules.
- Why are these new rules important for trustees?
- How do the new rules differ from the current ones?
- Do the new rules change how my deposits are protected?
- When do these new rules take effect?
- What do I need to do if I am a Professional Trustee?
- Is there anything I should do now to ensure I am ready for April 30, 2022?
- How do I stay informed?
Why are these new rules important for trustees?
The new rules are important because they affect how deposits held by professional trustees receive deposit insurance protection, and how CDIC would address these deposits in the event of failure of a CDIC member institution.
How do the new rules differ from the current ones?
The new rules allow eligible professional trustees to designate certain accounts as professional trustee accounts (PTAs). By doing so, these trustees will no longer be required to regularly report beneficiary information to CDIC member institutions for these accounts, and instead would only need to provide beneficiary information to CDIC upon CDIC’s request.
For more information, please consult this overview of the changes:
Do the new rules change how my deposits are protected?
No. CDIC continues to insure eligible deposits in trust to a maximum of $100,000 per beneficiary under the new rules.
When do these new rules take effect?
The new rules will take effect on April 30, 2022.
What do I need to do if I am a Professional Trustee?
As these new rules only take effect on April 30, 2022, for the moment, no action needs to be taken by professional trustees. CDIC will continue to update this web page with more information.
In the meantime, please consult this timeline and check back regularly for updates leading to April 30, 2022 when the new rules come into effect.
Is there anything I should do now to ensure I am ready for April 30, 2022?
You may wish to consider the following questions in preparing for the changes to deposit protection:
- Considering the CDIC Act definition, do you or your organization qualify as a professional trustee?
- If you do qualify as a professional trustee, at which CDIC member institutions do you hold trust deposits for clients or beneficiaries?
- Can you identify the different accounts held in trust for clients/beneficiaries and do you have those account numbers readily available?
- Are there certain accounts that might be well suited to be considered professional trustee accounts? (for example, are they high-transaction accounts; do the beneficiaries under the account change often? does the total deposit value fluctuate regularly?)
- Are you capable of creating and maintaining a timely and accurate digital record of beneficiary information for accounts you may wish to designate professional trustee accounts?
How do I stay informed?
We encourage you to check back here regularly for updates about professional trustees and trust deposits. You can also subscribe to Industry News to receive notifications when new information is posted to this section.
CDIC is committed to fostering awareness and understanding of the new framework among trustees. We welcome your feedback, including any questions or comments. Please feel free to contact us at firstname.lastname@example.org. You can also follow us on social media for regular updates and information about deposit insurance. We’re here to help!