Regulations: your money
If you have a trading account with CMC Markets Canada, the following may be applicable to you.
Client money
Key points
- Retail client money is held in segregated client bank accounts
- CMC Markets does not use retail client money towards margins with its hedging counterparties
- CMC Markets Canada Inc. is a member of the Canadian Investment Regulatory Organization and a Member of the Canadian Investor Protection Fund. CFDs are distributed in Canada by CMC Markets Canada Inc. acting as principal.
Are my funds segregated?
Retail client money is held separately from CMC Markets’ own funds so that under property, trust and insolvency law, client money is protected and therefore unavailable to general creditors of the firm, if the firm fails.
Where does CMC Markets hold segregated client money?
We hold retail client funds in segregated bank accounts with a Canadian bank. This account is opened and maintained in the name of CMC Markets Canada Inc.
How does CMC Markets segregate my funds?
Funds deposited by our Canadian retail clients are held in segregated bank accounts. When funds are segregated, the cash held with a bank does not belong to the firm but to the clients of the firm, and it will be held in a way that enables it to be identified as such, and any charges, liens or rights of set-off or retention over the cash are waived.
CMC Markets performs daily client money reconciliations in accordance with CIRO requirements. This process ensures that funds held in segregated bank accounts always accurately reflect retail client assets. The full value of a client trading account is treated as client money. CMC Markets’ client money controls and processes are audited annually by our statutory auditors (PricewaterhouseCoopers) and the results are reported to CIRO. Internal audits and reviews are also undertaken periodically, which are overseen by independent Non-Executive Directors.
What happens to my money if CMC Markets goes into bankruptcy?
In the event of insolvency (known as primary pooling), retail clients would have their share of segregated money returned, minus the administrators’ costs in handling and distributing these funds.
Any shortfall of funds of up to $1,000,000 may be compensated for by the Canadian Investor Protection Fund (CIPF). More information on the nature and limits of coverage can be obtained at the CIPF website or by calling 1 866 243 6981
What happens to my money if a bank holding client money on behalf of CMC Markets goes into bankruptcy?
In the event of a insolvency (known as secondary pooling), losses would be shared by clients in proportion to the share of funds held with a bank which has failed.
Funds lost as a result may be compensated for by CIPF up to a limit of $1,000,000 per person, per institution, subject to other balances held with the bank in question.
Canadian Investor Protection Fund (CIPF)
The Canadian Investor Protection Fund provides limited protection for property held by a member firm on behalf of an eligible client, if the member firm becomes insolvent. Member firms are investment dealers that are members of CIRO (Canadian Investment Regulatory Organization). These investment firms are also automatically members of CIPF.
CIPF coverage is custodial in nature. CIPF does not provide protection against any other type of risk or loss. If you have an account with a member firm, and that firm becomes insolvent, CIPF works to ensure that any property being held for you by the firm at that time is given back to you, within certain limits. Client property can include securities and cash.
Further information on the Canadian Investor Protection Fund can be obtained from their website, http://cipf.ca/ or by calling them on +416 866 8366 or 1 866 243 6981.
