What is Capital Spreads policy regarding segregation of client funds? Are funds really ring-fenced?
Angus: All client funds are ring fenced. FSB: Most brokers are required to maintain proper segregation of client funds but trading deposits are often held in just one segregated bank account. Please comment. Angus: All our clients are classified as ‘retail’ which means that we hold their funds in a segregated bank account, separate from our own funds. This is a FSA requirement and means that a clients cash balance and any open profits are safe in the unlikely event that LCG goes under. We have some 45,000 clients if we had to open 45,000 different bank accounts for the clients the cost would be enormous and the level of KYC data required (to open an account in a third parties name) would also be prohibitive. The funds for each client are held electronically in individual internal accounts with LCG but the actual money is held with major retail banks..
