SAFETY OF FUNDS
XGLOBAL Markets maintains client denominated bank accounts with European and Swiss credit institutions, which are used exclusively to hold client funds and process withdrawals. These accounts are liquid current accounts so that funds belonging to clients can be readily withdrawn on a same day basis. The financial institutions used are selected on the basis of financial soundness while additional safety is ensured through diversification. Furthermore, XGLOBAL Markets has established an adequate organizational arrangement designed to minimize the risk of loss or diminution of client assets, or of rights in connection with those assets, as a result of misuse, poor administration or negligence of the banking institutions themselves.
According to Directive DI144-2007-01 regarding authorization and operating conditions of Cypriot Investment Firms (CIFs), for the purposes of safeguarding clients’ rights in relation to funds belonging to them, CIFs are required to follow all necessary steps designed to ensure that client funds are deposited in an account or accounts identified separately from any accounts used to hold funds belonging to the Company. To this end, client funds deposited with XGLOBAL Markets are fully segregated from the Company’s funds and such funds cannot be used for any other purpose. Further, XGLOBAL Markets keeps such records and accounts as are necessary to enable it at any time and without delay to distinguish assets held for one client from assets held for any other client (and from its own assets) in accordance with the requirements of the aforementioned Directive.
XGLOBAL Markets is a member of the Investor Compensation Fund, which is administered by the Central Bank of Cyprus and the Cyprus Securities and Exchange Commission for all clients of Cyprus Investment Firms. The purpose of the Investor Compensation Fund is to secure the claims of all covered clients, in this case retail clients, through the payment of compensation where the investment firm is unable to:
- Return client funds owed to them or funds which are held, directly or indirectly, in the context of providing investment services or
- To hand over to covered clients financial instruments which belong to them which the investment firm holds, manages or keeps on their account.
This ensures that retail clients of XGLOBAL Markets can claim compensation in the event that the Company is unable to fulfil its obligations. In effect, all covered clients are provided with a form of insurance for their funds in case of insolvency on the part of the Company. For more information you are encouraged to read the document titled Protection of Client Funds & Investor Compensation Fund.
The protection of client funds is of paramount importance for XGLOBAL Markets, which is why all client funds are held in segregated accounts within secure banking institutions, thereby safeguarding against their use for any other purpose. XGLOBAL Markets as a segregated account broker operates this kind of separate account principally to shield client investments from circumstances resulting from risk of any force majeure relating to company’s activity. Therefore, rest assured that all clients’ funds are intact with us.
XGLOBAL Markets is a member of the Investor Compensation Fund. The Fund was established under the Investment Firms Law of 2002 and the establishment and Operation of an Investor Compensation Fund for customers of Cyprus Investment Firms Regulations of 2004 which were issued under the Law. All retail clients have their funds insured to a maximum of 20,000 Euros each, in the unlikely event that the company cannot fulfill its obligations due to insolvency.
XGLOBAL Markets external auditor is Baker Tilly, who prepare and sign the audited financial statements. The firms internal audits are carried out by FAI Comply.
XGLOBAL Markets is regulated and licensed by the Cyprus Securities and Exchange Commission (CySEC) with license number 171/12. CySEC is a European Competent Authority that regulates, supervises, and controls Cypriot Investment Firms. In addition to all applicable local laws, rules, and regulations the Commission enforces European Directives, such as MiFId, by issuing corresponding local directives and circulars. As a licensed Cypriot Investment Firm, XGLOBAL Markets follows strict rulings in order to comply with its requirements in relation to the safety of client funds.