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Financial Regulatory Bodies Businesses Need To Keep In Mind When Operating

Written by Contributor, on 12th Apr 2018. Posted in General

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“Money makes the world go round” is a phrase that most will have heard, and while it is just a phrase, it also has some level of truth. Around the world, social status, quality of life and so much more can rely on how much money we have, and so it truly is understandable that regulation around how our money is handled by the companies we put so much trust into are being rolled out with increasing volume and strictness. Financial regulatory bodies are there to ensure that businesses are being fair and just, and adhering to certain rules and legislation, protecting not only customers, but other businesses too. Here, we’re taking a look at some of the world’s biggest financial regulatory bodies:

Central Bank of Ireland - Ireland

The CBI – or the Central Bank of Ireland – is the primary regulatory body within Ireland. They regulate over 10,000 firms in Ireland, covering retail banks, forex brokers, investment intermediaries, and mortgage providers that offer their services on a national level as well as overseas while based in Ireland. Through risk-based supervision, regulation is kept fair and just, with enforcement available in the case that any institutions aren’t following the right rules or are acting fraudulently.

The CBI have a focus on consumer protection, but, as a bank, also understand the need for financial stability and market integrity. As a result, this Irish financial regulatory body is one of the fairest in Europe. They regulate investments, insurance, mortgage and money lending, credit unions, stockbrokers and so much more. There’s truly not a financial stone left untouched by the CBI.

Financial Conduct Authority - UK

The Financial Conduct Authority, or the FCA, is the UK’s main regulatory body for all things financial. While this is the main body and is widely thought of as the only regulatory authority worth adhering to, it actually operates independently of the UK’s government. Members of the financial services industry can join the FCA, but as a result need to pay a fee which ensures that the FCA is financed and can keep going. Any financial firm that provides a service to consumers are regulated by this body which ensures that they provide fair services and maintain integrity.

The FCA have a significant level of power in regulating conduct of financial services. In March 2016 alone, the FCA and PRA joined forces to introduce a new regulation that would mean bank bosses were held responsible for misconduct at their companies, and in September of that year, the FCA went on to seek out a ban on the executive at banking giant Barclays.

Cyprus Securities And Exchange Commission - Cyprus

CySEC is, you guessed it, the regulatory body in Cyprus whom operate to ensure that all financial services within Cyprus are acting fairly and within MiFID II law. Registration to CySEC has always had an admirable volume, but in recent years, this has skyrocketed due to their approach to specialist financial services. In particular, this includes the likes of Binary Options and Forex. Gaining registration and approval from CySEC is one of the most popular methods of licencing for these brokers, and as a result, membership has grown considerably.

Their board is made up of five people – the Chairman and Vice-Chairman, who are employed in these roles full-time, and three other members who are of a non-executive level. CySEC has been under scrutiny before for this layout, as well as the fact that their regulation and penalties were once seen as being too weak and in need of tightening.

CFTC

The CFTC is a financial conduct body that is, just like the UK, separate from the government. However, this particular regulatory firm is focused on futures and options markets. The USA is a big country with a lot of money and as a result, there are plenty of regulatory bodies in place, but the CFTC in particular is worth note due to their focus on new and specialist markets. They state that their main mission is to ensure that markets are open, transparent, competitive and financially sound, protecting traders and brokers alike from the risks associated with these types of trade and potential fraud.

The CFTC encourages competitiveness and therefore efficiency, but aims to ensure that all derivative firms keep their integrity and perform only trustworthy and fair activity. Manipulation and abusive trading practices are unfortunately a big risk within the derivatives market, but the CFTC is there to help ensure the safety and protection of traders.

The financial regulatory body that you’ll have to follow will ultimately depend on the country you operate from, and often the type of service that is being offered. Whether partaking in the lesser-accepted binary options markets, or simply offering retail services to eager consumers, financial conduct is a vital part of ensuring trust, efficiency and integrity are all something that a brand or firm not only earns for themselves, but promotes as a whole.

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