72Security documents in custody of dealer

##### 72 Security documents in custody of dealer (1) Where a dealer receives for safe custody documents that are, or are documents of title to, securities, being documents that are the property of another person (in this subsection referred to as the client) and for which the dealer or a nominee controlled by the dealer is accountable, the dealer shall forthwith: (a) if the documents are not registered in the name of the client by the body corporate by which the securities were issued or made available and the client does not make a request as mentioned in paragraph (b) or (c)—cause them to be so registered; (b) if the client requests that the documents be registered by the body corporate by which the securities were issued or made available in the name of a nominee controlled by the dealer—cause them to be so registered; or (c) if the client requests that the documents be deposited in safe custody with the dealer’s bankers—cause them to be so deposited. (2) A dealer shall not deposit as security for a loan or advance made to the dealer documents that are, or are documents of title to, securities, being documents that are the property of another person (in this subsection referred to as the client) and for which the dealer or a nominee controlled by the dealer is accountable, unless an amount is owed to the dealer by the client in connection with a transaction entered into on behalf of the client, and the dealer: (a) gives a written notice to the client identifying the documents and stating that he intends to deposit them as security for a loan or advance made to the dealer; and (b) deposits the documents as security for a loan or advance made to the dealer that does not exceed the amount owed to the dealer on the day of the deposit by the client in connection with a transaction entered into on his behalf by the dealer. (3) Where: (a) a dealer has given a notice to a person as mentioned in subsection (2) and has deposited the documents referred to in the notice as security for a loan or advance; and (b) the person has paid the amount owed by him to the dealer, the dealer shall withdraw the documents from deposit forthwith after he receives the amount so owed to him. (4) Where a dealer deposits as security for a loan or advance made to the dealer documents that are, or are documents of title to, securities, being documents that are the property of another person and for which the dealer or a nominee controlled by the dealer is accountable, the dealer shall, at the expiration of 3 months after the day on which the documents are deposited, and at the expiration of each subsequent period of 3 months, if the documents are still maintained on deposit, send to the other person written notice to that effect. Penalty: $10,000 or imprisonment for 2 years, or both.