THE CORPORATIONS LAW

CCH Note: Part 13 of the Corporations Act 1989, inserted by sec 6 of No 110 of 1990, Sch 1 (effective 1 January 1991), begins as follows:

PART 13 - THE CORPORATIONS LAW
THE CORPORATIONS LAW 82
The Corporations Law is as follows:...

CHAPTER 7 - SECURITIES

PART 7.6 - MONEY AND SCRIP OF DEALERS' CLIENTS

SECTION 872 MONEY LENT TO DEALER

View history reference

872(1) [Application of section]

This section applies where a person (in this section called the client ) lends money to a dealer in connection with a securities business carried on by the dealer.

View history note

872(2) [Payment into separate account]

The dealer shall pay the money into an account that:

(a) the dealer maintains with an Australian ADI; and

(b) contains no money other than money lent to the dealer;

and shall so pay the money on or before the next day after the dealer receives it on which it can be paid into that account.

View history note

872(3) [Dealer to disclose loan to client]

The dealer shall give to the client a document (in this section called the ``disclosure document''), in the prescribed form, setting out:

(a) the terms and conditions on which the loan is made and accepted; and

(b) the purpose for which, and the manner in which, the dealer is to use the money.

872(4) [Condition for release of money]

The dealer shall keep the money in the account until the client gives the dealer a written acknowledgment that the client has received the disclosure document.

872(5) [Permitted use of loan]

The dealer shall not use the money except:

(a) for the purpose, and in the manner, set out in the disclosure document; or

(b) for any other purpose, or in any other manner, agreed on in writing by the dealer and the client after the dealer gives the disclosure document to the client.

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