It seems like this kind of terms about the clients funds is spreading among the SB. If IG now have about the same terms, I guess it could spread to the other SB's as well. No reason to stop trading with them, just as long one is careful , in keeping too much money in the account.
Best Thread Capital Spreads
Jack Hughes
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So why are they doing it?
tar
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" A firm must not hold client money in a client bank account outside
the United Kingdom, unless the firm has previously disclosed to the
client in writing:
(1) that his money may be deposited in a client bank account outside
the United Kingdom;
(2) that in such circumstances, the legal and regulatory regime
applying to the approved bank will be different from that of the
United Kingdom and, in the event of a failure of the bank, his
money may be treated in a different manner from that which
would apply if the client money was held by a bank in the United
Kingdom; and
(3) if it is the case, that a particular bank has not accepted that it has
no right of set−off or counterclaim against money held in a client
bank account in respect of any sum owed on any other account of
the firm, notwithstanding the firm’s request to the bank as
required by CASS 4.3.48R.
There is no need for a firm to make a separate disclosure under CASS 4.3.56R(
and (2) in relation to each jurisdiction.
Firms are reminded of the provisions of CASS 4.3.40R(4), that sets
notification and consents required when using a bank that is an not approved
If a client has notified a firm in writing before entering into a
transaction that client money is not to be held in a particular
jurisdiction, the firm must either:
hold the client money in a client bank account in a jurisdiction
which the client has not objected; or
return the client money to, or to the order of, the client. "
http://www.fsa.gov.uk/pubs/hb-releases/rel37/rel37cass.pdf
Seems FXCM UK gives a choice check 19.3
http://www.fxcm.co.uk/docs_pdfs/FXCM_LTD_Terms_of_Business.pdf
the United Kingdom, unless the firm has previously disclosed to the
client in writing:
(1) that his money may be deposited in a client bank account outside
the United Kingdom;
(2) that in such circumstances, the legal and regulatory regime
applying to the approved bank will be different from that of the
United Kingdom and, in the event of a failure of the bank, his
money may be treated in a different manner from that which
would apply if the client money was held by a bank in the United
Kingdom; and
(3) if it is the case, that a particular bank has not accepted that it has
no right of set−off or counterclaim against money held in a client
bank account in respect of any sum owed on any other account of
the firm, notwithstanding the firm’s request to the bank as
required by CASS 4.3.48R.
There is no need for a firm to make a separate disclosure under CASS 4.3.56R(
and (2) in relation to each jurisdiction.
Firms are reminded of the provisions of CASS 4.3.40R(4), that sets
notification and consents required when using a bank that is an not approved
If a client has notified a firm in writing before entering into a
transaction that client money is not to be held in a particular
jurisdiction, the firm must either:
hold the client money in a client bank account in a jurisdiction
which the client has not objected; or
return the client money to, or to the order of, the client. "
http://www.fsa.gov.uk/pubs/hb-releases/rel37/rel37cass.pdf
Seems FXCM UK gives a choice check 19.3
http://www.fxcm.co.uk/docs_pdfs/FXCM_LTD_Terms_of_Business.pdf
tar
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"A firm must not undertake any transaction for a client that involves
client money being passed to an intermediate broker, settlement
agent or OTC counterparty located in a jurisdiction outside the
United Kingdom, unless the firm has previously disclosed in writing
to the client:
(1) that his client money may be passed to a person outside the
United Kingdom; and
(2) that, in such circumstances, the legal and regulatory regime
applying to the intermediate broker, settlement agent or OTC
counterparty will be different from that of the United Kingdom
and, in the event of a failure of the intermediate broker,
settlement agent or OTC counterparty, this money may be treated
in a different manner from that which would apply if the money
was held by an intermediate broker, settlement agent or OTC
counterparty in the United Kingdom.
4.3.62 There is no need for a firm to make a separate disclosure under CASS 4.3.61R in
relation to each jurisdiction.
4.3.63 If a client has notified a firm before entering into a transaction that
he does not wish his money to be passed to an intermediate broker,
settlement agent or OTC counterparty located in a particular
jurisdiction, the firm must either:
(1) hold the client money in a client bank account in the United
Kingdom or a jurisdiction to which the client has not objected and
pay its own money to the firm’s own account with the broker,
agent or counterparty; or 2) return the money to, or to the order of, the client. "
http://www.fsa.gov.uk/pubs/hb-releases/rel37/rel37cass.pdf
client money being passed to an intermediate broker, settlement
agent or OTC counterparty located in a jurisdiction outside the
United Kingdom, unless the firm has previously disclosed in writing
to the client:
(1) that his client money may be passed to a person outside the
United Kingdom; and
(2) that, in such circumstances, the legal and regulatory regime
applying to the intermediate broker, settlement agent or OTC
counterparty will be different from that of the United Kingdom
and, in the event of a failure of the intermediate broker,
settlement agent or OTC counterparty, this money may be treated
in a different manner from that which would apply if the money
was held by an intermediate broker, settlement agent or OTC
counterparty in the United Kingdom.
4.3.62 There is no need for a firm to make a separate disclosure under CASS 4.3.61R in
relation to each jurisdiction.
4.3.63 If a client has notified a firm before entering into a transaction that
he does not wish his money to be passed to an intermediate broker,
settlement agent or OTC counterparty located in a particular
jurisdiction, the firm must either:
(1) hold the client money in a client bank account in the United
Kingdom or a jurisdiction to which the client has not objected and
pay its own money to the firm’s own account with the broker,
agent or counterparty; or 2) return the money to, or to the order of, the client. "
http://www.fsa.gov.uk/pubs/hb-releases/rel37/rel37cass.pdf
tar
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There is a reason for sure , it could be a bank or a third party outside the UK and the EEA ( Investment firm in Costa Rica ) ...
tar
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Worldspreads same like CS
http://www.worldspreads.com/pdfs/CustomerSpreadBettingAgreementNovember2007.pdf
http://www.worldspreads.com/pdfs/CustomerSpreadBettingAgreementNovember2007.pdf
My guess is better interest rate and lower cost for handling the account transactions. The funds with CS is still segregated, so this could be the reason why a lot of SB have started moving their bank accounts and transactions outside GB, but I honestly don't know. I guess we have to ask Simon, maybe he could clarify the matter.
Jack Hughes
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Simon's been a bit quiet recently... Don't they have broadband in Costa Rica?
Ha ha!
capitalspreads
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yeah busy busy
the reason for this change is really very prosaic
in the past all a spread betting company needed to do to take client money out of segregated funds was to call them 'professional' (or words to that effect) now we have to go through a whole palaver of calling the funds (rather than the client) something completely different that (frankly) i think is more confusing. but 'ce la vie'
London Capital Group spread betting division (Capital SPreads etc) has some 50 thousand clients we have 1 (one) client whose funds are not segregated. this client takes such big positions that we need his funds as margin to hedge with our brokers! So this change makes no difference to anyone (other than the one client that is). New clients are still automatically seggregated and so this will alter nothing.
all client funds must be held (by FSA rules) in highly secure financial institutions (as it happens our client funds are held with Barclays, HSBC, Lloyds and RBS) although we did remove them temporarily from Lloyds and RBS well before the chaos that engulfed them in 2008.
Naturally we must inform clients of changes to the Terms, even if they are minor and have no impact to the vast majority or are merely clarification of existing terms.
Simon
the reason for this change is really very prosaic
in the past all a spread betting company needed to do to take client money out of segregated funds was to call them 'professional' (or words to that effect) now we have to go through a whole palaver of calling the funds (rather than the client) something completely different that (frankly) i think is more confusing. but 'ce la vie'
London Capital Group spread betting division (Capital SPreads etc) has some 50 thousand clients we have 1 (one) client whose funds are not segregated. this client takes such big positions that we need his funds as margin to hedge with our brokers! So this change makes no difference to anyone (other than the one client that is). New clients are still automatically seggregated and so this will alter nothing.
all client funds must be held (by FSA rules) in highly secure financial institutions (as it happens our client funds are held with Barclays, HSBC, Lloyds and RBS) although we did remove them temporarily from Lloyds and RBS well before the chaos that engulfed them in 2008.
Naturally we must inform clients of changes to the Terms, even if they are minor and have no impact to the vast majority or are merely clarification of existing terms.
Simon
capitalspreads
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just read some of the more extreme comment
LCG holds all its spread betting client funds in UK financial institutions. We did look (in late 2008 early 2009) to move them out of the UK when all the UK banks were looking very dodgy indeed into secure accounts with banks not harmed by any of the sub-prime debt or other financial problems going round the globe (there were a few medium sized european banks that were secure) but in the end we did not do so.
All client funds remain in the UK and LCG has no intention of moving them out.
simon
LCG holds all its spread betting client funds in UK financial institutions. We did look (in late 2008 early 2009) to move them out of the UK when all the UK banks were looking very dodgy indeed into secure accounts with banks not harmed by any of the sub-prime debt or other financial problems going round the globe (there were a few medium sized european banks that were secure) but in the end we did not do so.
All client funds remain in the UK and LCG has no intention of moving them out.
simon
tar
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If this doesnt impact the majority y u dont give clients the chance to choose ?
tar
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This ends the disscussion thanks ...
tar
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I mean , y dont u give the clients the chance to opt-out from this rule ( holding client money outside the UK ) ?
"" A firm must not hold client money in a client bank account outside
the United Kingdom, unless the firm has previously disclosed to the
client in writing:
(1) that his money may be deposited in a client bank account outside
the United Kingdom;
(2) that in such circumstances, the legal and regulatory regime
applying to the approved bank will be different from that of the
United Kingdom and, in the event of a failure of the bank, his
money may be treated in a different manner from that which
would apply if the client money was held by a bank in the United
Kingdom; and
(3) if it is the case, that a particular bank has not accepted that it has
no right of set−off or counterclaim against money held in a client
bank account in respect of any sum owed on any other account of
the firm, notwithstanding the firm’s request to the bank as
required by CASS 4.3.48R.
There is no need for a firm to make a separate disclosure under CASS 4.3.56R(
and (2) in relation to each jurisdiction.
Firms are reminded of the provisions of CASS 4.3.40R(4), that sets
notification and consents required when using a bank that is an not approved
If a client has notified a firm in writing before entering into a
transaction that client money is not to be held in a particular
jurisdiction, the firm must either:
hold the client money in a client bank account in a jurisdiction
which the client has not objected; or
return the client money to, or to the order of, the client. "
http://www.fsa.gov.uk/pubs/hb-releas.../rel37cass.pdf
