The money invested by private equity funds always belongs to investors, and private equity institutions only manage it on their behalf. Unless otherwise agreed in the fund contract, the non-public offering fund shall be managed by the fund custodian.

Third-party custody means that after the fund transaction, the raised funds are deposited in a third party to ensure that they will not be misappropriated by relevant parties.

The custodian is an independent third party responsible for the security of fund custody, usually held by a large bank or securities company, and its qualification is verified by the China Securities Regulatory Commission or the China Banking Regulatory Commission.

In other words, the client's funds are not in the account of the private equity fund company, nor in the personal account of the private equity fund manager, but in an independent monitoring account, which is monitored by an independent third party, namely the custodian.