In our latest article on Forex Magnates, we discuss the appropriate licensing for copy traders and managed accounts (including PAMMs and MAMs).
With the CHF debacle taking precedence for the past month, a key release by the FCA became overshadowed by concerns that brokerages would not survive the sudden market movement.
Now that things have settled down, we consider it would be well advised for firms and traders trading on accounts of their clients to take note of recent regulatory developments in Australia and the UK, and obtain an appropriate licence in the relevant jurisdiction. As mentioned in Forex Magnates previously, the FCA has released guidance on its views about copy trading in the forex industry (which we consider are indicative of the view ASIC has and will continue to take) along with a variety of prosecutions in this space from Australia (e.g. Monarch FX), the UK and the US. People who are trading on account for their clients need to bring their activities within the regulatory sphere or face increasing risk of serious prosecution from their nearest regulator.