New Zealand FMA Censures Jarden Securities for DI License Breaches
- The breaches were made by OML before Jarden bought the company.
New Zealand's Financial Markets Authority (FMA) has censured Jarden Securities Limited for critical breaches derivatives issuer mandates by OM Financial Limited prior to their merger, the regulator announced on Thursday.
Jarden and OM Financials merged in March 2021 and the merged entity inherited properties, rights and liabilities, including OMF’s DI license. OMF was previously owned by NZ Capital Securities that brought the firm in November 2019.
The official announcement detailed that OMF transferred its own money into the account originally intended to hold clients’ funds between September 2015 and July 2020. It made around 150 Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term totaling $1 million. OMF self-reported the breaches to the regulator in September 2020.
The FMA mandates DIs to segregate company money from clients’ funds. Though they can deposit money into the trust account to safeguard against the risk of a shortfall, OMF used the deposited funds for making business-related payments to third-party providers.
Clients' Funds Are Safe
“Although no OMF clients lost money as a result of this issue, we considered that investor money was at risk while the necessary separation processes were not in place,” said James Greig, FMA Director of Supervision.
“The breaches warranted a public censure due to the significant period over which they occurred, as well as the value and number of transactions.”
Earlier this week, the FMA censured Auckland-based Firma Foreign Exchange Corporation (NZ) Limited for multiple violations as a regulated derivatives issuer.
“While we acknowledge that OMF self-reported these issues to us, managing Client Money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term in accordance with the regulations is a fundamental, minimum requirement for any licensed derivatives firm. In these circumstances, the self-reporting of the issues is expected and does not prevent the FMA from taking action and using our regulatory tools to hold firms to account. Jarden has engaged constructively with the FMA through this process and implemented changes to ensure this issue doesn’t happen again,” Greig added.
New Zealand's Financial Markets Authority (FMA) has censured Jarden Securities Limited for critical breaches derivatives issuer mandates by OM Financial Limited prior to their merger, the regulator announced on Thursday.
Jarden and OM Financials merged in March 2021 and the merged entity inherited properties, rights and liabilities, including OMF’s DI license. OMF was previously owned by NZ Capital Securities that brought the firm in November 2019.
The official announcement detailed that OMF transferred its own money into the account originally intended to hold clients’ funds between September 2015 and July 2020. It made around 150 Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term totaling $1 million. OMF self-reported the breaches to the regulator in September 2020.
The FMA mandates DIs to segregate company money from clients’ funds. Though they can deposit money into the trust account to safeguard against the risk of a shortfall, OMF used the deposited funds for making business-related payments to third-party providers.
Clients' Funds Are Safe
“Although no OMF clients lost money as a result of this issue, we considered that investor money was at risk while the necessary separation processes were not in place,” said James Greig, FMA Director of Supervision.
“The breaches warranted a public censure due to the significant period over which they occurred, as well as the value and number of transactions.”
Earlier this week, the FMA censured Auckland-based Firma Foreign Exchange Corporation (NZ) Limited for multiple violations as a regulated derivatives issuer.
“While we acknowledge that OMF self-reported these issues to us, managing Client Money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term in accordance with the regulations is a fundamental, minimum requirement for any licensed derivatives firm. In these circumstances, the self-reporting of the issues is expected and does not prevent the FMA from taking action and using our regulatory tools to hold firms to account. Jarden has engaged constructively with the FMA through this process and implemented changes to ensure this issue doesn’t happen again,” Greig added.