Delivery Versus Payment · Fund Verification & Compliance
The FVD-S Send Workflow
When an institutional client trades DVP/COD through an executing broker but custodies assets elsewhere, Reg T requires the executing broker to verify free funds. FVD-S digitizes that Letter of Free Funds loop end to end to meet the T+1 settlement clock — retiring manual email and fax.
DVP Trade Initiation
TriggerAn institutional client or investment advisor places a DVP trade; the executing broker fills it in the market. Because funding resides away at a custodian, the post-trade compliance clock starts immediately.
Data Ingestion & Validation
System ControlPost-execution details enter FVD-S via secure UI or batch file. Automated integrity checks confirm account identifiers, settlement constraints, and security descriptions conform to messaging standards before routing.
System Exception Queue
Formatting discrepancies are flagged to an internal queue for swift IT / Ops correction, then re-submitted.
Standardized LOFF Generation
ComplianceValidated data is automatically structured into a standardized digital Letter of Free Funds — removing the manual data entry, transcription, and transposition errors that historically cause settlement breaks.
Secure Encrypted Transmission
SecurityThe digital LOFF is dispatched to the target custodian over a centralized channel, end-to-end encrypted with TLS 1.3 / AES-256 — bypassing unsecure commercial email and fax entirely.
Custodian Review & Response
CounterpartyThe custodian verifies free-credit balance availability or account designation against their ledger, then submits a standardized response — confirming, denying, or providing prime-brokerage routing updates.
Automated Reconciliation & Matching
System ControlFVD-S captures the electronic response and runs a 1-to-1 match against the open request. Real-time dashboards monitor outstanding requests against processing cutoffs.
Operations Resolution
A denial or flagged mismatch triggers an instant Ops-desk notification for rapid bilateral intervention before settlement fails.
Trade Release & Regulatory Archive
Settlement · AuditThe verified trade clears settlement risk and settles on schedule under T+1. The full lifecycle — immutable timestamps, user actions, and data snapshots — is stored WORM for a FINRA-compliant SEC Rule 17a-4 audit trail.
SOC 2 Type II
Housed in an independently audited environment with 24/7 security monitoring across the full lifecycle.
RESTful API · SFTP
Deploys alongside existing clearing platforms, compliance engines, and back-office settlement infrastructure.
Hours → Minutes
Cuts fund-verification overhead by up to 90%, minimizing capital charges from settlement failures.
Two Sides, One Network
FVD-S Sends. FVD-R Receives.
FVD-S is the executing broker's Send side. The receiving custodian or carrying broker works the other half of the loop with FVD-R — receiving, AI-indexing, and responding to inbound Letters of Free Funds.