Paymaster

A paymaster is someone appointed by a group of investors or government to dispense commissions, fees or salaries within the private sector or public sector. Specific titles within the British government are Paymaster of the Forces, Paymaster-General and Paymaster of Pensions.

Purpose

The primary purpose of a paymaster is to receive fees in escrow by buyers in a large transaction, and disburse to the sellers and brokers on the transaction.

Paymasters often are, but are not required to be, a lawyer (also known as a 'lawyer paymaster'). When dealing with commission payments on contracts dealing with large amounts of money (such as Oil, Gas, Steel, Iron, Gold, MTN's, VG's, T-Strips, and other instruments), most banks in the United States are very wary of handling such large amounts of money. In addition, most buyers and sellers of such transactions want to place the money with a neutral third party for disbursement. In most cases, the buyer and the seller involved in the transaction require a paymaster be named to handle all incoming and outgoing funds.