When it comes to third-party custody, the most popular one is P2P three-party payment platform custody, which usually refers to investors opening personal accounts on third-party platforms.

This is different from private equity custody.

In the field of private equity investment, third-party custody, as the name suggests, means placing funds in third-party accounts other than managers and financiers. Through the management of fund allocation, it is possible to avoid any party from secretly transferring funds.

During the fundraising process of trusts (same as asset management/private equity funds), investors need to transfer funds to a designated, national unified account. This account is called a "raising account."

Investors can note that this account is a public account opened by the manager at a commercial bank or securities firm. Currently, most of the funds are deposited by appointment. During the fundraising period, investors first make an appointment with the financial manager to determine the amount, and then deposit money after clarifying their investment intentions.

If there is an over-funding situation without a reservation, a refund will generally be required.

During the fundraising period, the raised funds can only be deposited in the fundraising account and cannot be used by any institution or individual.

After the fundraising is completed, the manager will go through the account closing process.

Transfer the raised funds from the "raising account" to the "escrow account". The custodian is usually a bank or securities firm. The custodian verifies the arrival of the funds and issues a receipt notice to the manager.

When the manager issues a product establishment announcement, the funds will generally be transferred to the financier's account on the day the product is established, and interest will accrue on the funds on that day.

The above is the general process for bond-type trust/asset management/private equity funds. If it involves the secondary market or PE funds, it will be more complicated because it involves the daily operating expenses of the fund, performance commissions, etc.

In the tripartite custody mechanism, the management fees collected by the trust company are paid by the financiers, and the investors' funds go through "raising account → custody account → financier account", and the participants are the managers (trust companies/asset management companies/private equity institutions)

) → Custodian (bank or securities firm) → Financing party, the entire chain is clear and clear. Logically speaking, there is no situation where one party can embezzle funds.

However, problems inevitably exist in practice.

In the creditor's rights relationship, the manager usually does not strictly supervise the payment operation process and does not need to publicly disclose the payment situation. It only needs to pay interest regularly and repay the principal when due.

The prerequisite for the effective operation of tripartite custody is that the three parties are independent of each other and there is no nepotism.

Since trust and asset management managers all have institutional backgrounds, the possibility of joint cheating with financiers is extremely small; however, in private equity funds, there are no substantive regulations on the background of shareholders of private equity managers. Private equity companies of all sizes across the country have gone through a round of clean-ups.

There are probably tens of thousands more.

For example, a group owns several private equity companies and then establishes some project companies. After the project companies raise funds through the private equity companies, the funds flow back to the group company and become a de facto capital pool project.

Even the project manager may not be able to explain such project risks clearly.

Generally speaking, investors can basically confirm the safety of funds by grasping these points: 1. Make sure that the actual manager of their project is a trust company, asset management company, or contract-type private equity fund.

Since all three must go through the trust channel, some investors may think that they are all trusts and must be confirmed through contracts.

2. Confirm the fundraising account and account information (usually completed by the financial manager) 3. Conduct background checks on the financing parties.

Nowadays, companies are intertwined, and investigating group relationships usually involves a large amount of information confirmation.

This part is usually completed by your financial manager, so it is particularly important to choose a reliable financial manager.