The UK’s Financial Conduct Authority has asked brokers to take all the necessary steps to abide the 2007’s best execution concepts.
ForexMinute.com – After imposing a whopping fine of £4 million on FXCM last week, FCA has issued a reminder to all the brokers to acknowledge, and take, all necessary steps to avoid financial misconducts with clients. They have particularly reminded the brokers of the best execution concept, a part of the EU’s 2007 trading guidelines, which puts an obligation on them to offer the best possible deals to their clients.
The UK regulatory body, which is said to have been going through a “thematic review†of the best execution policies, has recently indicated the possibilities of conducting further investigations on CFD and spread-betting companies, as well as the forex brokers falling under their watch. Despite of being just an “indicationâ€, FCA may fine some more companies involved in trading misconducts.
Last week, FXCM was found to have stealing profits from their clients’ trades. FCA revealed that they have been pocketing the deals that were favoring the customers, whilst passing the deals that resulted in losses. The FCA Market Watch notice has warned firms that it would “seek to take further regulatory action†in case they are found misconducting the best execution policies.
**relatedarticle**
What is Best Execution under MiFID?
The May 2007’s guidelines under MiFID defines best executions as “the common standards of investors’ protection throughout the European Union.†They are designed to promote both market efficiency generally and the best possible execution results for investors individually.
The MiFID however has announced that it would make some amendments to the Best Execution Policies that would strengthen it further. The changes will come into effect in 2016, making brokers to take the very necessary steps towards ensuring the best possible results for their clients.
To contact the reporter of the story: Jonathan Millet at john@forexminute.com
