Regulatory Update from INFINOX
INFINOX has announced a recent change in regulation by the Securities Commission of The Bahamas (“SCB”).
In particular, the SCB has introduced new rules around the categorization of clients of CFD firms.
The Contracts For Difference Rules, 2020 (“new rules”) were adopted and officially gazetted in The Bahamas on 26 May 2020.
There will now be two categories of clients that apply under these new rules, being either Professional Client or Retail Client. Professional Clients will continue to benefit from unrestricted leverage, whereas Retail Clients will be subject to a maximum of 200:1 leverage.
There are a number of other protections that are afforded to Retail Clients that will not apply to Professional Clients. You are therefore encouraged to read the risk warnings in Appendix 1 by clicking the link below and familiarise yourself as they will directly affect you.
|Leverage Restriction||Negative Balance Protection||Segregated Client Money||Filing a Complaint to the SCB|
|Retail Client||Max 200:1||Yes||Yes||Yes|
As a client of IX Capital Group Limited (“IXCG”), if you are trading with an account of 200:1 and above INFINOX will be classifying you as a Professional Client.
Please take note of the risk warnings in Appendix 1, which set out the risks associated with the Professional Client categorization and highlight the protections that you will lose.
Should you wish to be classified as a Retail Client, you must inform INFINOX immediately by emailing Infinox’s support team.
The changes will take effect from 13th October 2021.
Appendix 1 – Loss of Protections Notice
1. Leverage Restrictions
As a Professional Client, you will not be subject to leverage restrictions imposed on Retail Clients. You might be exposed to higher leverage limits that can amplify your losses.
2. Negative Balance Protection
All clients will benefit from Negative Balance protection unless specifically agreed between IXCG and the Client.
3. Segregating Client Money
All clients are, regardless of category, afforded protection of their client money by requiring firms, on receiving any client money, to promptly place this money into one or more client accounts opened with, for example with an approved and authorized bank, such that there is appropriate segregation of client money from the firm’s own money as a safeguarding measure for the protection of the client’s money.
If a client wishes to opt-out of the segregated client money protection, they should contact [email protected]
4. Filing a Complaint
As a result of your categorization as a Professional Client, you may lose the right of referring a complaint against IXCG to the SCB.
5. Risk Warnings
INFINOXwill not be required to provide you with the written risk warnings and notice required for retail investors in relation to transactions in complex financial products, in particular derivatives and warrants.
6. Order handling and Reporting
The SCB does not require INFINOX or the Trading Agent to provide you with Account statements unless requested by you. Upon your request, the Trading Agent must provide you with your Account information and Account statements using report features as provided by IXCG. However, all clients, including Professional Clients, will have access to their Account and online trading platform, through which they can access all Transactions on their account in relation to their managed account at any time.
7. Customers’ understanding of Risk & Appropriateness
INFINOX is not obliged to ensure that you understand the nature of any risks involved in any specific investments or transactions that INFINOX offers to you. INFINOX will assume that you are in a position to judge the kind and degree of risk attached to the various types of investments.
8. Financial Disclosures on Promotions
Certain SCB rules regarding the form and content of financial promotions will not be applicable. When communicating with you, INFINOX has required under the SCB rules that all INFINOX’s communications are fair, clear and not misleading, however, INFINOX may take into consideration your status as a Professional Client when complying with such requirements and in assessing whether any communication to you is likely to be understood by you in accordance with your level of expertise and contains appropriate information for you to make an informed assessment of its subject matter. This means that any financial promotion INFINOX communicates or approves which identifies or promotes a specific investment, INFINOX will not be required to provide you with a comprehensive description of the nature of the investment, the commitment required risks, costs, and associated charges, that apply in the case of Retail Clients.
9. Disclosure of charges, remuneration, or commission
The SCB rules do not require INFINOX to inform you, in writing, of the basis or amount of INFINOX’s charges applicable to the services INFINOX will be providing and the nature or amount of any other income receivable by IXCG, the Trading Agent or INFINOX’s associates which is attributable to those services. However, IXCG in its sole discretion provides you with details of the fees associated with the Account which are related to the Trading Agent (relates to LPOA/IB Agreement).
10. Modification of certain rules
SCB rules also allow INFINOX to modify the application of the rules relating to confirmation of transactions, periodic statements, best execution, custody of assets, and client money. If any of these apply, INFINOX will explain the potential consequences to you in full.
Summary of Condition – Infinox in The Bahamas
Infinox Capital in The Bahamas, which is regulated by The Securities Commission of The Bahamas, offers the following conditions for traders.
Protection you will lose:
- You will fall outside of the EU’s regulatory regime – MiFID II.
- You will therefore lose all protections afforded under EU regulation and law.
Under SCB Regulation, INFINOX will provide the following protections:
- Best Execution
- INFINOX will maintain the commitment to act honestly, fairly and in the best interests of all INFINOX’s clients in order to offer the best possible execution.
- Segregated Account
- Your funds will be kept in a segregated account at all times under the SCB’s Client Money rules.
- Prescribed Risk Warning
- INFINOX will continue to provide you with a standardized risk warning, including the percentage of retail clients that lose money trading with Infinox Capital.
- Balance Protection
- INFINOX will continue to protect your account from a negative account balance.
Go to INFINOX’s Official Website and find out more about the recent regulatory changes.