New Zealand’s FMA Censures Firma NZ for Multiple Violations
- “Firma’s breaches are highly concerning,” FMA Director of Supervision said.
New Zealand’s Financial Markets Authority (FMA) has issued a censure order against Auckland-based Firma Foreign Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Corporation (NZ) Limited for multiple violations as a regulated derivatives issuer.
According to Monday’s regulatory announcement, Firma NZ failed to conduct product suitability tests for clients and repeatedly failed to meet the obligatory tangible asset requirement. Additionally, the company failed to regularly provide statements to derivative investors regulating their investments and did not have effective policies and procedures to ensure controls.
Firma NZ offered retail trading services with Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term futures contracts in New Zealand. It is a fully-owned subsidiary of Canada-based Firma Foreign Exchange Corporation and received FMA’s Derivatives Issuer license in 2015.
Concerning Breaches
“Firma’s breaches are highly concerning because clients were not assessed to see if they were suitable to trade derivatives and then, because they did not receive regular statements, had little visibility of their performance or portfolio,” said James Greig, FMA Director of Supervision.
In addition, he pointed out that the censure order was appropriate as the company’s breaches were persistent and systematic.
“Firma is publicly held to account and must provide us an action plan to remedy the issues and ensure future compliance,” Greig added.
The FMA is regarded as one of the reputed regulators in the Asia Pacific. It regulates a number of financial services providers locally in New Zealand. Last year, it conducted a sector risk assessment and is now in the process of conducting an in-depth monitoring review of the derivatives issuer industry.
“It’s critical that derivatives issuers meet the conditions of their licence because these are high-risk financial products and trading them isn’t suitable for most retail investors. We have previously flagged the sector as high risk, with client suitability tests as a key area of focus,” Greig said.
New Zealand’s Financial Markets Authority (FMA) has issued a censure order against Auckland-based Firma Foreign Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Corporation (NZ) Limited for multiple violations as a regulated derivatives issuer.
According to Monday’s regulatory announcement, Firma NZ failed to conduct product suitability tests for clients and repeatedly failed to meet the obligatory tangible asset requirement. Additionally, the company failed to regularly provide statements to derivative investors regulating their investments and did not have effective policies and procedures to ensure controls.
Firma NZ offered retail trading services with Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term futures contracts in New Zealand. It is a fully-owned subsidiary of Canada-based Firma Foreign Exchange Corporation and received FMA’s Derivatives Issuer license in 2015.
Concerning Breaches
“Firma’s breaches are highly concerning because clients were not assessed to see if they were suitable to trade derivatives and then, because they did not receive regular statements, had little visibility of their performance or portfolio,” said James Greig, FMA Director of Supervision.
In addition, he pointed out that the censure order was appropriate as the company’s breaches were persistent and systematic.
“Firma is publicly held to account and must provide us an action plan to remedy the issues and ensure future compliance,” Greig added.
The FMA is regarded as one of the reputed regulators in the Asia Pacific. It regulates a number of financial services providers locally in New Zealand. Last year, it conducted a sector risk assessment and is now in the process of conducting an in-depth monitoring review of the derivatives issuer industry.
“It’s critical that derivatives issuers meet the conditions of their licence because these are high-risk financial products and trading them isn’t suitable for most retail investors. We have previously flagged the sector as high risk, with client suitability tests as a key area of focus,” Greig said.