27 March 2017: The CFD & FX Forum, whose member Firms represent the majority of trading volumes, has strongly welcomed today’s parliamentary passage of a Government bill that introduces significant protection and reform for client monies in the contracts for difference (CFD) and foreign exchange (FX) sectors. Schedule 5 of the Treasury Laws Amendment (2016 Measures No. 1) Bill 2016 amends the Corporations Act to provide greater protection for retail client money and property held by financial services licensees in relation to over-the-counter derivative products such as CFD and FX contracts. These amendments align the Australian client money regime with community expectations regarding the level of protection that should be afforded to retail consumers of complex financial products and services. Schedule 5 also allows for ASIC to have greater oversight of the sector. ASIC may, by…
The Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer MP, today announced that the Government will proceed with reforms that will provide better protection for retail investors in over-the-counter derivatives products. Australian financial service licence holders (Firms) can currently use money held on behalf of retail derivatives clients for a wide range of purposes, including for working capital. Use of client money for these purposes is either not permitted, or is more heavily regulated, in a number of other advanced G20 economies. Permitting the use of client money for these purposes therefore exposes Australian retail clients to a greater risk of loss in the event of the Firm’s insolvency. As announced in the draft Bill released in February 2016, the new client money protection regime will remove the current exemption…
CFD & FX Forum strongly welcomes Government legislation to better protect client monies in the Contracts for Difference (CFD) and Foreign Exchange (FX) retail derivatives sectors The CFD & FX Forum, whose member Firms represent the majority of trading volumes in these sectors, has strongly welcomed today’s announcement by the Government that it will move to introduce legislation to better protect client monies, saying the proposed legislation will lift investor confidence and enhances Australia’s standing as a well-regulated financial centre with best practice investor protection legislation. Read more here: cfd-fx-forum-welcomes-governments-move-to-protect-client-money8-nov-2016
In October 2015, the Government, as part of a wider response to its root and branch examination of Australia’s financial system (the Inquiry), announced that it would develop legislative amendments to improve protections for client monies held in relation to derivatives.1 The Government noted that improvements were needed to ensure that investors’ monies are adequately protected when held by intermediaries. To read the Policy Paper on the enhanced protection of client money Click Here
