Deposit at Custodian (DWAC) is an electronic process that allows Merrill Lynch clients to transfer certificates between broker/dealers and the Depository Trust Corporation (DTC) as authorized by FAST (Fixed Automated Securities Transfer).

The settlement of securities transactions often involves a transfer of paper certificates, which can cause delays, damage or loss of the assets, and legal complications. The DWAC process was designed to streamline and reduce the risk of losses associated with the transfer of physical certificates and to facilitate quicker, more efficient settlement.

Through the DWAC process, the buyer's broker sends an electronic message to the seller's broker and the Depository Trust Corporation (DTC). The message identifies the buyer and seller and includes instructions for DTC to move the securities from one broker's account to another, without the need for certificates to physically change hands.

The benefits of using this mechanism are numerous. By electronically transmitting data around settlement of the certificates, faster settlement of transactions is achieved as the need for paper work is eliminated. Furthermore, the risk of delay or loss is drastically reduced as no manual paperwork is involved, meaning that risks associated with certificates being lost or damaged on their way to the other broker are eliminated.

The process of transfer is also legally secure, ensuring that the buyer is legally entitled to the certificate and there are no legal complications associated with the transfer.

DWAC is a system that offers a highly secure, reliable and cost-efficient transfer method, providing greater flexibility to the buyers and sellers and facilitating quicker settlement times. This method has been widely accepted and is becoming increasingly popular as more and more transactions are settled electronically instead of through paper work.