ADVOKS GLOBAL · KENYA
The Capital Markets (Licensing Requirements) (General) Regulations
19. Records to be maintained
Edition: 2023-10-06 · In force
19. Records to be maintained
(1)A stockbroker and dealer shall maintain and preserve for a period of seven years, the following accounting documents—(a)journals or other records of original entry containing an itemized daily record of all purchases and sales of securities, all receipts and deliveries of securities (including certificate numbers), all receipts and disbursements of cash and all debits and credits; the records shall show the account for which each transaction was effected, the name and amount of securities, the unit and aggregate purchase or sale price (if any), the trade date and the name or other designation of the person from whom the securities were purchased or received or to whom they were sold or delivered;(b)ledgers, (or other records) reflecting all assets and liabilities, income, expense and capital accounts;(c)detailed records of nominee accounts;(d)all cheque books, bank statements, cancelled cheques and bank reconciliation accounts;(e)clients’ accounts (or other records) itemizing separately each account of a client, all purchases, sales, receipts and deliveries of securities and all other debits and credits;(f)a memorandum of each client’s order received for the purchase or sale of securities; the memorandum shall show orders in chronological sequence, the time of receipt, the terms and conditions of the order or instructions and of any modification or cancellation thereof, the account for which the order was entered, the time of entry into the market for execution, the price at which the order was executed and, to the extent feasible, the time of execution or cancellation;(g)copies of confirmation of all purchases and sales, notices of all other debits and credits for securities and other items for the account of client;(h)records on all commissions earned on account of equities, bonds and others;(i)contract books or records, showing details of all contracts entered into with trading participants of a securities exchange and duplicates of memoranda of confirmation issued to such other trading participant; and(j)any other accounting documents as may be determined by the Authority.(2)The accounting documents specified under paragraph (1) shall be subject to inspection from time to time and without notice, by the Authority or securities exchange of which the stockbroker or dealer is a trading participant.(3)A stockbroker shall maintain and preserve for each person who becomes a client, records and accounts for a period of seven years containing information on—(a)where the client comes through an investor agent, in the agent sub-account and where the client has been attended to by the supervisor or employee of the stockbroker authorized to attend to clients in the stockbroker’s account, the client’s name, date of birth, address, nationality or citizenship, identification, written instructions of the client, price limit, duration of the instructions and date of order and the name and address of the investor agent (where applicable) and where the client is a company, certified copies of memorandum and articles of association and the certificate of incorporation;(b)where the stockbroker, or any of its agents has made any recommendations to the client to purchase or sell any security, the record of such client shall include the client’s occupation, identification, investment objectives, other information concerning the client’s financial situation and needs which the stockbroker or any of its agents considered in making the recommendation, and the signature and name of the agent who made the recommendation to the client and the date when any order was given to the stockbroker or its agent and any price limit given;(c)a record or records with respect to each discretionary account including—(i)the client’s written authorization to the stockbroker to exercise discretionary power or authority in the client’s account;(ii)the reason given by the client for granting discretionary power or authority in his account; and(iii)the written approval of the stockbroker’s designated supervisor of each transaction in such account indicating the exact time and date of such approval;(d)a separate record for all complaints by clients and persons acting on behalf of clients; the complaints shall be filed alphabetically by clients’ names and shall include copies of all materials relating to the complaint, and record of what action, if any has been taken by the stockbroker; copies of such materials and record of action taken shall be kept in the office through which the client’s account is handled;(e)a separate record of all securities transactions by the stockbroker’s or dealer’s employees and directors in their own name or under nominees' accounts;(f)a separate record of all securities transactions between the stockbroker or dealer, and all listed companies in which the directors of the stockbroker or dealer have an interest; and(g)such other records as the Authority shall determine from time to time.(4)A stockbroker shall decline to take an order if, after reasonable inquiry, the client declines to furnish such items of information as required in paragraph (3)(a), (b) and (c) and a statement to that effect is placed in the records, provided, however, that the client’s records shall state the client’s name and address.