The FinancialApril 16, 2018, The Financial Commission, a leading independent member-driven external dispute resolution (EDR) organization for international online brokerages that participate in global foreign exchange (forex), derivatives, and cryptocurrency markets, announced the implementation of a new voice risk disclaimer (VRD) to be used by broker members in providing consulting or advisory services to their customers.
In an effort to educate traders about the risks involved with trading financial markets, the Commission already requires broker members to provide all clients that receive investment advisory or trade advisory services (investment advice) verbally, orally or other digital methods from staff, management, contractor, analyst, consultant, affiliate or IB partner of the broker.
Today, brokers must obtain a voice recording from their customers acknowledging and accepting full risk of loss for any investments made in their trading account as a result of advice provided from the company or its agents via voice or digital methods.
The update to the VRD is aimed to ensure that clients are aware of the services they are being provided and are ultimately responsible for trading or not trading based on the trading strategies shared by any consultants, independent advisors or 3rd parties. Ultimately, clients can choose not to receive such advisory services from their trading provider and can make their own determinations on investment objectives.
As before, broker members will be required to continue to adhere to the rules regarding voice disclosure record keeping requirements.
For more information regarding voice risk disclosure requirements please review the Commission’s Membership Rules and Guidelines or contact us on [email protected].