investors Archives - The Industry Spread

SEC Educational Videos Aim to Help Investors Spot and Avoid Fraud

October 16, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: investors, SEC, SEC Educational Videos

Washington D.C., Oct. 11, 2019 — The SEC’s Office of Investor Education and Advocacy and Retail Strategy Task Force this week released new Educational videos and Investor Alerts to help show investors what fraud looks like. Fraudsters will use every gimmick they can think of to get their hands on investors’ hard-earned money. These videos, along with our other investor education materials on Investor.gov, provide practical information that Main Street investors can use to avoid fraud and become empowered to make the best investment decisions possible for a strong financial future.

“One way to protect your hard-earned money is to learn how to spot investment scams and to stay clear of them,” said SEC

Jay Clayton Securities and Exchange Commission (SEC) Chair

Chairman Jay Clayton. “These videos will help investors identify and avoid actual fraudulent schemes that we have recently charged.”

The fraudulent tactics revealed in these alerts and videos are based on real-life cases. For example, the SEC recently took enforcement action against boiler-room-like call centers that swindled investors by allegedly: (1) creating a false sense of urgency and asking investors to submit personal documents for the defendants to use if investors disputed unauthorized credit card charges in SEC v. Petersen; and (2) promising investors highly profitable results, directing investors to wire money to third-party companies, and instructing investors to tell their banks that the wires were for other purposes in SEC v. Senderov and Babazara.

SEC Provides Red Flags for Scams Techniques

October 14, 2019 by Michael Volpe Leave a Comment Filed Under: Feature Articles Tagged: investors, Scams, SEC

The Securities and Exchange Commission (SEC) is warning investors about common scam techniques. They have put together a video series which can be found here. The series noted that investors should be weary of fake testimonials, offers which purport to expire, requests to send money abroad, and using credit cards, or even multiple credit cards, to open an account.

The SEC further noted, “One of the most common gimmicks con artists use is to promise investors that they will make a lot of money in a short period of time – that they will ‘get rich quick.’ Con artists may trick investors into believing that they will make tons of money with little or no effort (for example, for purchasing products or for performing trivial tasks, such as clicking on digital ads each day).”

These warnings are based on several recent cases prosecuted by the SEC.

In SEC Vs. Peterson, a case which the SEC charged in September 2019, the SEC alleges that defendants used call centers in Germany to fraudulently sell binary options.

Here is part of a press release from the SEC.

“According to the SEC’s complaint, the defendants conned U.S. and foreign investors out of tens of millions of dollars through three online binary options brokers, Bloombex Options, Morton Finance and Starling Capital, by the allure and promise of quick profits. The SEC alleges that defendants utilized call centers in Germany and Israel which operated as ‘boiler rooms,’ in which salespersons used high pressure sales tactics to offer and sell speculative binary options to vulnerable investors. Employees at these call centers allegedly persuaded investors to open binary option trading accounts and deposit large sums into those accounts.

According to the SEC complaint, the scam involved high pressure tactics by opening accounts using credit cards, much like the SEC warned.

“The call centers then encouraged investors to make large deposits, oftentimes from credit cards and retirement and savings accounts. They also falsely told investors that they only made money when investors made money,” the SEC complaint stated.

Binary options are exotic and very risky investments which involve all or nothing bets.

In the US, binary options can only be traded legally on exchanges, both NADEX and Cantor are licensed binary options exchanges.

In this scam, the options were traded over the counter, meaning that Peterson’s company only made money if the investors lost, “Unbeknownst to investors, Defendants only earned money if investors made large deposits and then lost their trades. Defendants thus had but one goal in mind for investors who opened accounts at their broker firms: to convince those investors to continue depositing more and more cash into their accounts and cause them to lose their money by trading binary options.”

Another case which features these sorts of scam techniques is SEC Vs. Anton Senderov and Lior Babazara, another binary options scheme.

In this scheme, the scammers made common get rich quick promises, according to the SEC complaint, “For example, the LBinary and Ivory Option websites and the call center employees claimed that investors could make large profits trading binary options while working with LianTech’s supposedly experienced investment professionals. In fact, the LianTech call center employees were trained to lie about their backgrounds and investment experience.”

The SEC released a video made in this scam.

According to a testimonial made on its website, a purported investor claimed, “I activated that software on Sunday January 10th, 2016, and here is what my account was worth on January 17th.”

The screen then flashes to purport to show that his account was worth $17,869.54.

“How is this even legal?” The purported investor claims during his testimonial.

Ironically, according to the SEC, none of it is, though not for the reasons in the promotional videos.

Investors should visit investor.gov for further information for spotting scams.

SEC Orders an Additional 16 Self-Reporting Advisory Firms to Pay Nearly $10 Million to Investors

October 3, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: Advisory Firms, investors, SEC

Washington D.C., Sept. 30, 2019 — The Securities and Exchange Commission today announced settled charges against 17 Self-Reporting Advisory Firms for disclosure failures regarding their mutual fund share class selection practices. The firms include 16 advisers that self-reported as part of the Division of Enforcement’s Share Class Selection Disclosure Initiative and one adviser that did not self-report and was ordered to pay a $300,000 civil penalty.

As part of the initiative announced on Feb. 12, 2018, the Division of Enforcement agreed that for eligible firms that self-reported by the deadline, the Division would recommend standardized settlement terms to the Commission, including that the Commission not impose a civil penalty. On March 11, 2019, the Commission instituted actions against 79 advisers that participated in the initiative, ordering the payment of over $125 million in disgorgement and prejudgment interest to investors. Today, the Commission issued orders against 16 additional advisers that self-reported as part of the initiative, bringing the total amount ordered to be returned to investors to over $135 million. The Commission did not order a civil penalty as to any of those self-reporting firms.

The Commission today also charged Mid Atlantic Financial Management Inc., which was eligible to self-report as part of the initiative but did not. The Commission found that Mid Atlantic, whose affiliate received 12b-1 fees, failed to fully disclose the conflicts arising from its selection of more expensive mutual fund share classes for clients when lower-cost share classes for the same fund were available. Among other things, the SEC ordered Mid Atlantic to pay over $1 million in disgorgement and prejudgment interest. Unlike the firms that self-reported as part of the initiative, however, the Commission also ordered Mid Atlantic to pay a $300,000 civil monetary penalty.

“Today’s actions reaffirm the benefits to advisers and their clients for self-reporting as part of the Initiative,” said C. Dabney O’Riordan, Co-Chief of the Asset Management Unit. “They also demonstrate the Commission’s commitment to holding advisers accountable for selecting more expensive investments that eat away at their clients’ investment returns without proper disclosure.”

The SEC’s orders find that the 16 self-reporting firms violated Section 206(2) of the Investment Advisers Act of 1940, and ordered that they are censured, that they cease and desist from future violations, that they pay disgorgement and prejudgment interest totaling nearly $10 million and that they comply with certain undertakings, including returning the money to investors. As to Mid Atlantic, the SEC’s order finds that it violated Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-7 thereunder, and ordered that it is censured, that it cease-and-desist from future violations, that it pay disgorgement and prejudgment interest totaling over $1 million and a $300,000 civil penalty, and that it comply with certain undertakings, including returning the money to investors.

The Share Class Selection Disclosure Initiative is being led by the Division of Enforcement’s Asset Management Unit. The settlements announced today were coordinated by SEC attorneys Robert Baker, Cindy Baran, Brian Basinger, Anne Graber Blazek, Panayiota Bougiamas, Jason Burt, Payam Danialypour, Charles Davis, Ronnie Lasky, Heather Marlow, Brendan McGlynn, Paul Montoya, Michael Moran, Jessica Neiterman, Donna Norman, Christine O’Neil, Jeremy Pendrey, Max Polonsky, Melissa Robertson, Corey Schuster, Andrew Shoenthal, Ivonia Slade, Al Tierney, Ariana Torchin, Karen Willenken, Kate Zoladz, and John Farinacci, an industry expert in the Asset Management Unit.

The SEC’s investigation of Mid Atlantic was conducted by Oreste P. McClung and supervised by Brendan P. McGlynn, both of the Asset Management Unit in the Philadelphia Regional Office. Mr. Farinacci assisted with the investigation.

Firms Charged That Self-Reported as Part of the Initiative:

Bill Few Associates Inc.

Cargile Investment Management Inc.

Comprehensive Capital Management Inc.

Equity Services Inc.

Essex Financial Services Inc.

Folger Nolan Fleming Douglas Capital Management Inc.

Henley & Company Wealth Management LLC

Hilltop Securities Inc. and Hilltop Securities Independent Network Inc.

IC Advisory Services Inc.

Independent Financial Group LLC

Investment Partners Ltd.

IPG Investment Advisors LLC

Michigan Advisors Inc.

Saxony Capital Management LLC

Wedbush Securities Inc.

FMA Sets Out Key Focus Areas For The Year Ahead

July 28, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: Annual Corporate Plan, FMA, investors

FMA sets out key focus areas for the year ahead. The FMA today published its Annual Corporate Plan (ACP), which outlines its work plan for the next financial year and sets objectives for raising standards of behaviour across financial services.

The development of the 2019-20 ACP is based on a new sector-based approach that is set out in the FMA’s refreshed Strategic Risk Outlook (SRO), also published today.

The SRO provides our medium-term view of the most significant risks, as well as the major opportunities and challenges, to deliver the FMA’s mission of fair, efficient and transparent financial markets. These documents also describe our expectations of how firms need to serve the needs of their customers.

Rob Everett, Chief Executive at the FMA, said: “We have introduced a sector-based approach to provide a clear indication to stakeholders of the priority risks we want to address and the activities we will undertake to achieve our goals in the specific sectors we regulate. Our new approach reflects the maturity of the Financial Markets Conduct Act regime and our broadening focus on the treatment of investors and customers.”

The sector approach is focused on:

Capital Markets
Investment Management
Sales, Advice and Distribution
Banking and Insurance.

The FMA’s refreshed approach has resulted in the FMA updating its strategic priorities, these are:

governance culture, systems and controls
credible deterrence of misconduct
successful implementation of potential remit changes
investor and customer decision-making
promoting trust and confidence in capital markets.

These priorities provide a blueprint for what will guide our decision-making and focus our activity in the coming year. Longer-term opportunities and challenges include significant regulatory and legislative changes, impacts of innovation and climate change and the value for money of financial products. As well as changing macro-economic conditions, the emergence and development of conduct regulation internationally, and challenges to trust and confidence, highlighted through the Australian Royal Commission.

Mr Everett noted the implementation of the new regime for financial advisers as a significant piece of work in the year ahead. “We will also work closely with the Government and industry to prepare for and implement any changes to the conduct regulation regime for banks and insurers.”

“Our ongoing work with the Reserve Bank of New Zealand on the conduct and culture reviews of the banking and life insurance sectors reflects our overall objective to improve standards of behaviour and ensure all providers are serving the needs of their customers.

“We expect all market participants to review the risks we’ve identified in the sectors that impact them, assess the relevance of these risks, and what they are doing to mitigate them. Market participants should not be waiting for legislative changes, or the regulator to come knocking, to do the right thing,” Mr Everett said.

Majority of Canadian Investors Support Measures to Protect Vulnerable Investors, IIROC Survey Reveals

July 2, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: advisor, Canadian Investors, financial exploitation, IIROC, IIROC Survey, investment industry, investors, public interest, regulatory rules, Vulnerable Investors

Canadians want regulatory rules, policies and procedures put in place to prevent financial exploitation June 21, 2019 (Toronto, Ontario) – The Investment Industry Regulatory Organization of Canada (IIROC) today released results of a new national IIROC survey showing an overwhelming majority of Canadian investors believe that protective measures should be put in place to ensure that investment firms and advisors can take action when they suspect investors have become vulnerable or that others might be attempting to financially exploit them.

Highlights:

93 per cent support having a “trusted contact” listed on their account – someone the firm or advisor can contact if they believe an investor has become vulnerable or may be subject to attempted financial exploitation
89 per cent support a “temporary hold” – giving investment advisors and firms the ability to temporarily pause account activity if they receive instructions that are out of character and not in the investor’s best interest or raise suspicion of potential financial exploitation
86 per cent support creating a regulatory “safe-harbour” – providing investment advisors and firms protection from possible regulatory sanctions if they take action to protect a potentially vulnerable investor, for example by temporarily refusing instructions that are not in the investor’s best interest while investigating the situation and/or reaching out to a trusted contact
92 per cent agree it is necessary to have such regulatory tools in place to allow advisors and firms to protect vulnerable investors

“It is encouraging to see resounding support from Canadians for measures to safeguard vulnerable investors – particularly seniors – and protect them from financial exploitation,” says Andrew J. Kriegler, IIROC’s President and CEO. “This input from investors complements the comments we have heard from the investment industry on the need for tools like a regulatory safe-harbour to address the issues associated with Canada’s aging population and vulnerable investors.”

While less than a quarter of investors said they had already identified a trusted contact for their investment advisor, 71 per cent of investors said if asked, they would provide a name and contact information for someone that could be reached if an advisor became concerned about possible vulnerability, diminished capacity or financial exploitation.

Investors surveyed also underlined the need for clarity and transparency in the development of any regulatory proposal, with nine out of 10 agreeing on the need to establish clearly defined circumstances when advisors and firms are able to take protective action.

“We will continue our collaboration with the Canadian Securities Administrators (CSA) on proposals to provide the tools needed to protect vulnerable investors,” Kriegler said.

IIROC also plans to work with its regulatory, industry, government, stakeholder and community partners to develop information resources to support conversations between investors, advisors and others on the decisions and actions they can take together to address potential vulnerability and financial exploitation.

The survey, conducted for IIROC in March by The Strategic Counsel, involved 1,000 investors from across Canada to find out about their familiarity with the possible measures that can be taken to protect vulnerable investors and their support of specific concepts, such as a trusted contact, temporary hold and regulatory safe-harbour. Survey respondents were pulled from IIROC’s Investor Panel – an online pool of 10,000 investors created by IIROC to allow Canadians to provide their input directly into the regulatory process and associated public interest issues.

IIROC sought investor input on this important subject before any specific regulatory proposals had been published so that investors’ views could help inform these considerations. Any future proposal will build upon IIROC’s guidance for those who work with senior clients published in 2016, which encourages IIROCregulated investment firms to have policies and procedures that detect and address potential financial exploitation and diminished capacity situations.

IIROC will also continue to create member education webcasts to help firms and advisors protect their clients.

SEC Names Holli Heiles Pandol as Director of the Office of Legislative and Intergovernmental Affairs

June 28, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: busiess, Director, finance, Holli Heiles Pandol, industry, Intergovernmental Affairs, investors, SEC

Washington D.C., June 26, 2019 — The Securities and Exchange Commission today announced that Holli Heiles Pandol has been named Director of the agency’s Office of Legislative and Intergovernmental Affairs. Ms. Pandol will advise the Chairman, Commissioners, and SEC staff on legislative matters, provide technical assistance on securities-related legislation to congressional committees and staff, assist in preparing SEC testimony for congressional hearings, and coordinate with other government entities.

Jay Clayton, SEC Chairman

“I have had many opportunities to work with Holli as we have advocated for the agency’s mission on Capitol Hill over the past several years, and I am happy that she will continue her service to our markets and investors in her new position,” said Chairman Jay Clayton.

Ms. Pandol added, “I am honored and excited to serve in this new role. I look forward to continuing to work with Congress, the Chairman, the Commission, and its dedicated staff to help advance the interests of Main Street investors and support the integrity of our markets.”

Ms. Pandol previously served in the Office of Legislative and Intergovernmental Affairs as Senior Counsel. Before joining the SEC, Ms. Pandol spent over five years on Capitol Hill, most recently as Counsel at the House Financial Services Committee. Previously, she served as Senior Advisor and Counsel to Rep. French Hill, and Legislative Director and Tax Counsel to former Rep. Tim Griffin.

Ms. Pandol received her B.S.B.A in finance and accounting, magna cum laude, and J.D., magna cum laude, from the University of Arkansas, and LL.M. in Taxation, with distinction, from Georgetown University Law Center.

SEC Names Vanessa Countryman to Lead the Office of the Secretary

June 28, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: business, industry news, investors, markets, official Commission actions, rulemakings, SEC, Sunshine Act

Washington D.C., June 24, 2019 — The Securities and Exchange Commission today announced that Vanessa Countryman has been appointed as the agency’s Secretary. The Secretary is responsible for overseeing the administrative aspects of Commission meetings, rulemakings, and procedures. Ms. Countryman has served as Acting Secretary since March 2019.

Within the SEC, the Office of the Secretary plays a central role in ensuring the effective processing of Commission business. Office staff, among other things, review all documents submitted to the Commission, track documents submitted to the Commission, schedule Commission meetings in accordance with the Government in the Sunshine Act, maintain records of official Commission actions, and provide public notice of those actions on the SEC.gov website and in the Federal Register.

Jay Clayton, SEC Chairman

“Since she stepped into the role of Acting Secretary earlier this year, Vanessa has led the office with the utmost professionalism and integrity,” said SEC Chairman Jay Clayton. “I am pleased that the office and the agency as a whole will continue to benefit from her expertise and institutional knowledge.”

Ms. Countryman added, “I am honored and excited for the opportunity to serve in this role. It is a privilege to continue to be part of the Office of the Secretary’s exceptional team and support the Commission’s mission on behalf of investors and markets.”

Ms. Countryman joined the SEC in July 2010 as a Counsel to Commissioner Kathleen Casey and subsequently to Commissioner Daniel Gallagher. Since 2013, Ms. Countryman served as Chief Counsel in the Division of Economic and Risk Analysis, where she actively participated in numerous significant rulemakings. Prior to joining the SEC, Ms. Countryman clerked for Judge Emilio Garza on the Fifth Circuit Court of Appeals and then practiced law at Gibson, Dunn & Crutcher LLP, representing clients in appellate and regulatory matters. Ms. Countryman earned her J.D. from the University of Chicago. She received an M.Phil. from Oxford University and a B.A. from Columbia University.

SEC Updates List of Firms Using Inaccurate Information to Solicit Investors

June 15, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: avoiding fraud, Federal government, federal securities laws, fraud, Impersonators, Investor Alert, investors, Investors Buy Stock, Money, PAUSE, SEC

Washington D.C., June 10, 2019 — The Securities and Exchange Commission today announced that it updated its list of unregistered entities that use Inaccurate information to solicit primarily non-U.S. investors, adding 11 soliciting entities, four impersonators of genuine firms, and nine bogus regulators.

The SEC’s list of soliciting entities that have been the subject of investor complaints, known as the Public Alert: Unregistered Soliciting Entities (PAUSE) list, enables investors to better inform themselves and avoid being a victim of fraud. The latest additions are firms that SEC staff found were providing inaccurate information about their affiliation, location, or registration. Under U.S. securities laws, firms that solicit investors generally are required to register with the SEC and meet minimum financial standards and disclosure, reporting, and recordkeeping requirements.

Jennifer Diamantis, Chief of the SEC’s Office of Market Intelligence

“By making this information readily available through the PAUSE list, investors are better able to evaluate solicitations to buy and sell securities and avoid being a victim of fraud,” said Jennifer Diamantis, Chief of the SEC’s Office of Market Intelligence.

In addition to alerting investors to firms falsely claiming to be registered, the PAUSE list flags those impersonating registered securities firms and bogus “regulators” who falsely claim to be government agencies or affiliates. Inclusion on the PAUSE list does not mean the SEC has found violations of U.S. federal securities laws or made a judgment about the merits of any securities being offered.

The PAUSE list is periodically updated by the SEC’s Office of Market Intelligence in coordination with the Office of Investor Education and Advocacy and the Office of International Affairs.

How to protect yourself:

Be aware that fraudsters may impersonate government agencies to lure investors into scams, including advance fee fraud schemes.

Impersonators may falsely claim to be affiliated with the SEC (or another federal government agency) in an attempt to steal your personal information or your money. Federal government agencies, including the SEC, do not endorse or sponsor any particular securities, issuers, products, services, professional credentials, firms, or individuals.

Investor Alert: SEC Impersonators Pretend to Help Investors Buy Stock.

Visit Investor.gov for tips on investing wisely and avoiding fraud.

Singapore FinTech Festival and SWITCH Come Together – to Bring the Global Innovation Community to Singapore

June 15, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: Fintech, Global Innovation, investors, MAS, Singapore, singapore fintech festival, sustainability, SWITCH, technological innovation

Singapore, 12 June 2019… The Monetary Authority of Singapore (MAS), Enterprise Singapore and the National Research Foundation (NRF) today announced that the Singapore FinTech Festival (SFF) and the Singapore Week of Innovation and TeCHnology (SWITCH) would come together as SFF x SWITCH to synergise across the themes of FinTech and Deep Tech. SFF x SWITCH will run from 11 to 15 November 2019.

SFF x SWITCH will bring insights from global thought leaders, showcase innovative solutions, and engage entrepreneurs, investors and innovators from around the world. It will also provide rich networking opportunities for participants to collaborate on technological innovation across five key sectors – FinTech, Urban Solutions and Sustainability, Health and Biomedical Sciences, Advanced Manufacturing and Engineering, and Digital Services. Participants can look forward to the following key events.

Singapore FinTech Festival and SWITCH come together – to bring the global innovation community to Singapore

Participants can gain access to the three-day Conference & Exhibition of both events, which will take place from 11 to 13 November 2019 at the Singapore Expo. The Conference will feature for the first time the theme of sustainability, and cover Financial Services; Industry 4.0 – Artificial Intelligence, Blockchain, Cloud and Cybersecurity; Financial Inclusion; Green Finance; and Technology Beyond Finance. The Exhibition will feature country pavilions, industry exhibitors, financial industry showcase booths, and a startup zone.

There will be three Competitions for the global innovation community:

Global FinTech Hackcelerator, which matches innovative startup solutions to address industry’s problem statements;
SLINGSHOT 2019, an international startup pitching competition; and
FinTech Awards, which recognises innovative financial technology solutions.
Finalists from the competitions will showcase their solutions at SFF x SWITCH.

Investors and companies can have access to two Deal-Making Platforms:

Deal Fridays, curated deal-making sessions for facilitating investment into startups, that will run every Friday from 21 June to 25 October 2019; and
TechInnovation, a technology-to-industry matching marketplace which facilitates business matching within the industry, seeds licensing opportunities and fosters open innovation collaborations.

On 14 and 15 November 2019, workshops and events designed for the tech industry and an expanded Innovation Lab Crawl will take place at various locations across the island.

Mr Sopnendu Mohanty, Chief FinTech Officer, MAS, said, “The Singapore FinTech Festival is the world’s largest FinTech gathering and a marquee event for the global FinTech community. Our partnership with SWITCH this year allows us to engage technology ecosystems beyond FinTech, and to present a comprehensive showcase of innovations that benefit all segments of society. We look forward to welcoming players from the FinTech and wider technology community from all over the world to Singapore, to connect, collaborate, and celebrate innovation.”

Mr Peter Ong, Chairman, Enterprise Singapore said, “SFF x SWITCH is the foremost platform to bring together tech communities and startups around the world to bridge the gap between technology and finance for deep tech and FinTech. Singapore hosts a vibrant community of innovation enablers, enterprises and startups to drive co-innovation of new solutions relevant to global needs and modern challenges. Our strong connectivity to the region will serve as a gateway for enterprises and market-driven solutions to reach Asia and beyond.”

Dr Cheong Wei Yang, Deputy Chief Executive Officer, NRF, said, “This collaboration between SWITCH and the Singapore FinTech Festival will consolidate our national efforts to create value from science and technology – starting from the capabilities built in our research base, through to innovation and commercialisation by our enterprises. We will focus on deep tech areas relevant to Singapore’s growth as a Global-Asia node of technology, innovation and enterprise. We are excited to see more researchers, entrepreneurs, investors and companies coming together from all around the world, to benefit society and economy through innovation in new business models and novel technologies.”

Singapore FinTech Festival is organised by MAS, in partnership with The Association of Banks in Singapore, and in collaboration with SingEx Holdings. SWITCH is organised by Enterprise Singapore, NRF, and Intellectual Property Intermediary (IPI). Last year, the two events together drew close to 57,000 delegates from almost 130 countries. For more information on SFF x SWITCH 2019, please see the attached factsheet or visit www.SFFxSWITCH.com.

About the Monetary Authority of Singapore

The Monetary Authority of Singapore (MAS) is Singapore’s central bank and integrated financial regulator. As central bank, MAS promotes sustained, non-inflationary economic growth through the conduct of monetary policy and close macroeconomic surveillance and analysis. It manages Singapore’s exchange rate, official foreign reserves, and liquidity in the banking sector. As an integrated financial supervisor, MAS fosters a sound financial services sector through its prudential oversight of all financial institutions in Singapore – banks, insurers, capital market intermediaries, financial advisors, and stock exchanges. It is also responsible for well-functioning financial markets, sound conduct, and investor education. MAS also works with the financial industry to promote Singapore as a dynamic international financial centre. It facilitates the development of infrastructure, adoption of technology, and upgrading of skills in the financial industry.

FCA Confirms New Rules for P2P Platforms

June 10, 2019 by industryspread Leave a Comment Filed Under: Regulatory Annoucements Tagged: FCA, finance products, financial advice, home finance, Investments, investors, MCOB, P2P market

Following consultation, the Financial Conduct Authority (FCA) is introducing rules designed to prevent harm to investors, without stifling innovation in the (peer-to-peer) P2P Platforms. When the FCA set its first rules for P2P, it committed to keep these under review as the sector evolved. These new rules are designed to help better protect investors and allow firms and fundraisers to operate in a long-term, sustainable manner.

Christopher Woolard, Executive Director of Strategy and Competition at the FCA said:

‘These changes are about enhancing protection for investors while allowing them to take up innovative investment opportunities. For P2P to continue to evolve sustainably, it is vital that investors receive the right level of protection.’

The FCA has refined its proposals to ensure the new rules protect consumers and support the P2P market. In particular, additional guidance has been provided to make it clear that platforms will not be prevented from including information about specific investments in their marketing materials.

Christopher Woolard, FCA Executive Director of Strategy and Competition

As originally proposed, the FCA is placing a limit on investments in P2P agreements for retail customers new to the sector of 10 per cent of investable assets. This is an important means of ensuring that they do not over-expose themselves to risk. The investment restriction will not apply to new retail customers who have received regulated financial advice.

In addition to these restrictions, the new rules cover:

More explicit requirements to clarify what governance arrangements, systems and controls platforms need to have in place to support the outcomes they advertise, with a particular focus on credit risk assessment, risk management and fair valuation practices.
Strengthening rules on plans for the wind-down of P2P platforms if they fail.
Introducing a requirement that platforms assess investors’ knowledge and experience of P2P investments where no advice has been given to them.
Setting out the minimum information that P2P platforms need to provide to investors.
Applying the Mortgage and Home Finance Conduct of Business (MCOB) sourcebook and other Handbook requirements to P2P platforms that offer home finance products, where at least one of the investors is not an authorised home finance provider.

P2P platforms need to implement these changes by 9 December 2019, except for the application of MCOB, which applies with immediate effect.

The FCA will continue to closely monitor the P2P market as it develops further.

Notes to editors

PS19/14: Loan-based (‘peer-to-peer’) and investment-based crowdfunding platforms: Feedback to CP18/20 and final rules
CP18/20: full consultation paper
The interim feedback to the Call for Input to the post-implementation review of the FCA’s crowdfunding rules
On 1 April 2013, the FCA became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the PRA. On 1 April 2014, the FCA took over responsibility for consumer credit regulation and loan-based crowdfunding became a regulated activity.
The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this, it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
Find out more information about the FCA.

Notes to editors

How did you hear about us?

Links

Social Media

Subscribe