Deposit institutions should have an experienced internal team responsible for implementing all DACs. Relationship officers should not implement DAC, but should be informed of the importance of sending DACA applications through the filing institution`s DACA preparation, verification and enforcement protocol. As long as DACA is carefully prepared and negotiated adequately by the custodian`s advisor, incorrect implementation of a DACA is the primary source of exposure to a custodian institution. The custodian ensures that all necessary checks have been carried out on the corresponding deposit accounts and that the depository is ready to implement and implement all the instructions it receives within the time frame set by the DACA. Small depots, in particular, should be alert to the lack of key personnel and have safeguard procedures in place to ensure that DACA instructions are always implemented in a timely manner. If the deposit establishment. B does not require exclusive control of deposit accounts within the DACA time frame, the deposit-taking institution may be held responsible for all withdrawals made by the borrower from the deposit accounts after the implementation of the exclusive control. A deposit account control agreement (DACA), also known as a control agreement, is a tripartite agreement between a deposit client (the debtor), a client`s lender (the guaranteed party) and a bank. Secure Part (Lender) – part of a DACA that borrows funds and obtains a perfect security interest on the debtor`s deposit account when executing the contract. A lender can establish “control” in one of the following ways: (i) the borrower holds his deposit account directly with the lender; 2. The lender becomes the effective owner of the borrower`s deposit accounts with the borrower`s custodian banks; or (3) the lender and borrower enter into a deposit account control agreement (known as DACA) with the borrower`s deposit bank.

These agreements apply in all cases in addition to the guarantee agreement by which the borrower grants a security interest on his deposit accounts. Active Deposit Account Control Agreement – A control agreement that orders the bank to accept the instructions of the secured party (not the debtor).