What we do with your money
When you deposit money into an IG account as a retail client, it’s protected in a number of ways.
Your money is held in segregated client bank (independent trust) accounts at regulated banks
Your money and assets (shares, for example) are never merged with IG’s own money or assets
Authorised and regulated by the Financial Conduct Authority
Your assets are held by a custodian in segregated (nominee) client asset accounts
Your money and assets are ring-fenced from creditors in the unlikely event that IG goes into liquidation
IG doesn’t use your money or assets for business activities, including for hedging trades with other counterparties (or as margin for our own hedging trades)
What does IG do with my money and my assets?
Unlike banks, investment firms like IG are required to separate client money and assets from their own resources. This means that we’re not allowed to use them in the course of our business activities, and that client money and assets are completely ring-fenced and protected in the unlikely event that IG became insolvent.
IG is authorised and regulated by the Financial Conduct Authority (FCA). The FCA have strict regulatory requirements, known as the client money and client assets rules (found in the Client Assets Sourcebook – CASS), which govern exactly what we can do and how we must do it.
The only clients whose money and assets aren’t treated like this are professional clients (such as other financial firms), or eligible counterparties who have signed a legal document explaining how their money and assets are held differently (this is known as ‘title transfer’).
What happens to the money I deposit with IG?
Your money is held in segregated bank accounts under trustee arrangements. This ensures that the cash remains yours, rather than IG’s. It also means that it’s easily identifiable as client money, so IG and its creditors don’t have any charge, liens, or rights of set-off or retention over it.
We have a number of segregated bank accounts at a range of credit-worthy high street banks such as Barclays and Lloyds. We intentionally ensure that client money is split between a number of banks, and we’re not permitted to hold it all in one place.
We may place funds in notice or term deposit accounts with a notice period or term of up to 95 days. Placing client money in notice or term deposit accounts does not in itself affect your ability to deal with or withdraw funds from your account with us, however, in the unlikely event of insolvency of IG, such amounts may not be immediately available upon request.
What happens to the shares that I buy at IG or transfer to IG?
Your shares are held in a segregated client accounts under nominee arrangements with approved custodians. This means that they’re easily identifiable as client assets and, as with cash, IG and its creditors don’t have any charge, liens, or rights of set-off or retention over them. Your shares may be pooled with other clients’ shares, but never with shares owned by IG.
What happens to my money or assets if IG goes into liquidation?
In the unlikely event of this happening, all our clients would have their share of the segregated money or segregated assets returned, minus the administrators’ costs in handling and distributing these funds.
Any shortfall of funds of up to £85,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). The FSCS is the compensation fund of last resort for customers of authorised financial services firms. It is designed by the UK government to act as a ‘safety net’, and usually covers private investors (retail clients) and small businesses if they have been clients of a financial services firm which becomes insolvent.
What happens to my money if one of the banks IG uses to hold client money goes into liquidation?
The losses would be shared by clients in proportion to the share of money held with the failed bank. Funds lost in this way may be compensated for under the FSCS up to a limit of £85,000 per person, per institution, subject to other balances held with the bank in question.
Find out more about what the FSCS covers and who is eligible to claim at their website www.fscs.org.uk.
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