INDOS Financial provides the following services:

  • Independent AIFMD depositary solutions
  • Cayman Islands AML officer roles to depositary clients
  • ESG fund oversight

AIFMD depositary services

We provide AIFMD depositary services to a broad range of alternative investment funds (AIFs) managed by EU and non-EU alternative investment fund managers (AIFMs). We hold a range of FCA regulatory permissions which enable us to service:

  • open and closed ended hedge funds, and private equity, real estate or other funds domiciled outside of the EU managed by EU managers (depositary-lite model);
  • open or closed ended UK unauthorised funds investing in financial instruments (full depositary);
  • closed ended UK private equity, real estate or other real assets funds domiciled in the UK (PE/ RE depositary);
  • non-EU managers marketing offshore funds in Germany and Denmark (depositary-lite under Article 42 AIFM “gold plating”).

Our AIFMD depositary services include one or more of the following: Safe Keeping of Assets (both financial instruments held in custody and verification of non-custody assets), Cash Flow monitoring, and Oversight (including oversight of valuation of the AIF and the AIF’s compliance with investment restrictions and leverage limits).

We are currently receiving enquiries from AIFMs that fall into one or more of the following categories:

Managers that initially selected a depositary service affiliated to their administrator for convenience reasons but are now questioning the value or service they are receiving;

  • UK investment trusts seeking an alternative to the traditional bundled service model offered by banking groups;
  • Managers concerned about the limitations and risks of a reverse solicitation strategy;
  • Managers that are planning to market their fund;
  • Small AIFM that expect to pass the €100m gross assets threshold and will be required to become Full Scope AIFM;
  • Non-EU managers seeking to market in Germany or Denmark therefore requiring a depositary-lite solution.

Cayman Islands AML officer roles to depositary clients

The Cayman Islands have issued revised AML requirements, the Proceeds of Crime Law (2018 Revision) and the Anti-Money Laundering Regulations (2018 Revision), (collectively the “AML Regulations”). On December 13, 2017 and more recently on July 20, 2018 the Cayman Islands Monetary Authority (“CIMA”) issued revised Guidance Notes to provide general guidance to entities which are classified as financial service providers (“FSPs”) operating in the Cayman Islands.

The revised AML Regulations and Guidance Notes require FSPs to appoint an Money Laundering Reporting Officer (“MLRO”), Deputy Money Laundering Reporting Officer (“DMLRO”) and Anti-Money Laundering Compliance Officer (“AMLCO”). CIMA will permit FSPs to delegate these functions to third parties including individual employees/ natural persons of independent service providers.  The same individual can act as AMLCO and either DMLRO or MLRO, but the DMLRO and MLRO must be separate individuals.

The AMLCO acts as the point of contact with the relevant authorities in the Cayman Islands and is responsible for ensuring compliance with the AML Regulations. This includes developing and maintaining AML systems and controls, conducting regular audits of the AML programme, maintaining relevant logs, reporting to the board of directors of the funds (or equivalent) on material compliance issues and AML systems and controls, and responding promptly to requests for information by the relevant authorities.

The MLRO acts as the point of contact for all suspicious activity reports and is required to report suspicious activities to the relevant authorities in the Cayman Islands. The DMLRO acts as the alternate to the MLRO and in the absence of the MLRO would discharge its duties.

INDOS is offering this delegated service model to existing clients of its depositary services using certain administrators.

ESG fund oversight

INDOS provides a range of services for clients who incorporate environmental, social and governance (ESG) considerations into their investment businesses.

As a depositary that is well versed in alternative investment fund oversight, we are uniquely placed to provide value added services to our clients including:

ESG compliance oversight: As an extension of our core depositary services we can monitor compliance with mandates including ESG requirements. Coupled with our independent depositary services, we can provide a holistic programme of fund oversight benefitting managers, fund boards and investors;

ESG due diligence & reporting: In partnership with the specialist social finance law firm and social impact consultancy, Prime Advocates, we can provide an enhanced ESG oversight, or due diligence service. We draw on additional data sources to actively monitor ESG processes, adherence to ESG policies, and to provide complementary reporting services for our clients; and

Advisory: We offer advisory services to clients who want to explore ESG or impact investment opportunities and work with them to understand their ESG, risk and return requirements, and develop tailored recommendations based on their needs.

Contact us to discuss your requirements

We are an experienced team of industry professionals, leveraging an in-house developed technology solution, DEPOCheck, to deliver a first class service to our clients. To request more details about any of our services or to arrange a meeting please click here.