Your money’s safety is our top priority. Discover how TorFX keeps client funds secure in FCA-regulated segregated accounts, even in insolvency.
TorFX is authorised by the Financial Conduct Authority as an Electronic Money Institution (“EMI”). As an authorised company, we are required to safeguard client monies by holding those monies in a segregated client account, separate from our own business accounts.
These accounts are designated as client accounts and protected in the event of our insolvency or the insolvency of the banks we use to hold the client funds.
Our safeguarding obligations are outlined in the FCA Approach document which can be found here.
Safeguarding is the obligation to identify and keep client monies segregated and protected from all other funds that the business may hold, moving the funds to a safeguarding account if they are still held by the company the day after receipt. The obligation commences as soon as funds are identified as client monies (and stops when funds are remitted to the clients’ recipient). For an electronic money institution, relevant funds are deemed as follows: Funds received by the company when e-money is issued – i.e. where funds are visible in a client’s wallet.
The funds are no longer deemed relevant once the company has remitted them to the recipient and the company can reasonably assume that the funds have reached the recipient's bank account.
Funds that are not deemed relevant include the following:
Deposits for forward contracts, until they are released into the client’s wallet following the forward contract being settled.
Margin calls on forward contracts until they are released into the client’s wallet following the forward contract being settled.
Unclaimed or unknown funds – where funds come in with no client reference, and despite reasonable efforts we cannot allocate them to a client wallet.
Where client funds are subject to safeguarding, that means that client monies benefit from the arrangements put into place to protect these funds in the event of an insolvency event of the company. Client funds are held in segregated accounts, and moved to safeguarded accounts if the monies are still with the company the day after receipt. Both accounts are designated as client accounts.
If funds do not arrive within expected time frames a ‘trace’ can be placed by our Operations Team to track the progress of the payment. Occasionally payments can be delayed by intermediary banks and in extreme cases may be returned if the bank account details are deemed invalid. Depending on the location of the beneficiary bank account and the reason for the delay, a trace is usually able to resolve any issue within a few days.
Currencies Direct safeguards relevant funds in accordance with the Electronic Money Regulations 2011 (EMRs). Where applicable, funds received from clients in relation to regulated electronic money issuance are held in segregated client bank accounts. These arrangements ensure that safeguarded client funds are protected in the event of Currencies Direct’s insolvency and are kept entirely separate from the firm’s own operational and corporate funds.
No – as an EMI company, we are not in scope of the FSCS, which has a cap on coverage of £120,000. An EMI company, however, is required to safeguard the entire value of relevant client funds, even where this is above £120,000, so safeguarding is not subject to a cap.
An E-Money Company in the UK is authorised by the FCA. A Bank is regulated by the FCA and PRA.
Under the FCA rules and guidance, a bank’s client money rules are governed by the Client Assets Sourcebook (CASS) regime. An EMI company’s client money rules are governed by the safeguarding rules outlined in the FCA’s Approach document which can be located here.
TorFX’s FCA entry can be found here.