Account Transfers

Core Concepts

ACAT Transfer System

The Automated Customer Account Transfer Service (ACATS) is operated by DTCC's National Securities Clearing Corporation (NSCC) and provides a standardized, automated mechanism for transferring customer accounts between broker-dealers and banks. ACATS is the primary system for transferring brokerage accounts in the United States and is governed by FINRA Rule 11870 (Customer Account Transfer Contracts).

How ACATS works — the transfer lifecycle:

1. Transfer Initiation (Day 0) — The customer signs a Transfer Initiation Form (TIF) authorizing the transfer. The receiving firm submits the transfer request through ACATS, specifying whether the transfer is full or partial and listing the assets to be transferred.
2. Validation (Days 1-3) — The delivering firm receives the transfer request and has 3 business days to validate the account information and asset positions. The delivering firm must verify the customer's identity, account number, SSN/TIN, and the assets listed in the request. If the information matches, the delivering firm validates the request. If there are discrepancies, the delivering firm may reject the request with a specific reject code.
3. Asset Transfer (Days 4-6) — Once validated, the delivering firm must transfer the account assets within 3 business days (6 business days total from initiation). ACATS coordinates the settlement of securities between the firms through NSCC. Cash balances are transferred via the Federal Reserve wire system or NSCC settlement.
4. Residual Processing (Days 7+) — After the primary transfer completes, the delivering firm processes residual items: dividends or interest that were accrued but not yet paid, fractional shares (typically liquidated and sent as a residual credit), reorganization proceeds, and any other items that could not be transferred on the primary settlement date.

Full ACAT vs partial ACAT:

• A full ACAT transfers the entire account — all positions, cash, and account features. The delivering firm closes the account after transfer completion. Full ACATs are the most common transfer type and benefit from the highest degree of automation.
• A partial ACAT transfers only specified positions and/or cash amounts. The account remains open at the delivering firm with the remaining positions. Partial ACATs require the receiving firm to specify exactly which positions and quantities to transfer. Partial ACATs are used when a client wants to consolidate specific holdings, when certain assets are ineligible for ACAT transfer, or when the client is maintaining accounts at both firms.