Protection of Funds

Investor Compensation Scheme


Investor Compensation Scheme

Tier1 FX, forex broking division of Hogg Capital Investments as a Licence Holder of Category 2 of Investment Services, participates in and contributes to the Investor Compensation Scheme established in terms of the Investor Compensation Scheme Regulations. The Scheme is based on the EU Directive 97/9 on investor-compensation schemes. It serves as a rescue fund of failed investment firms for retail investors as well as smaller businesses, charities and trusts (excluding Professional Clients as per MiFID categorization).

The purpose of the Scheme is to grant the right to claim compensation under the Scheme to any Retail investor “who has entrusted money or instruments to a licence holder in connection with licensed business.” The compensation is paid only if the Investment Services Licence holder ceases to conduct its business due to financial difficulty or insolvency.

The total amount of compensation that may be paid out to an investor is calculated at the lesser of ninety per cent (90%) of all claims which have been made by such investor, or up to €20,000.

All computations and payments of compensation are made in the same currency as the investor’s investment. An investor may only submit one claim in respect of all his investments, taken in aggregate, with the licence holder concerned.

The rationale behind compensation schemes is to ensure a high level of investor protection and boost consumer confidence in the financial services industry. Compensation schemes are intended to guard against the failure and insolvency of individual institutions which may give rise to a negative domino effect potentially affecting otherwise prudent institutions.

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Segregation of Clients' Assets


Segregation of Clients’ Assets

All customer funds are held by Tier1FX pursuant to the laws of Malta, MiFID regulations and the rules and regulations of the Malta Financial Services Authority. Your “free cash balance” ~ funds not currently committed as collateral to margin open positions ~ are maintained in a segregated, off balance sheet, customer account at one of our qualified and approved credit institutions. Your funds are held in a Tier1FX customer segregated account with all other Tier1FX customers and this account is separate from and never comingled with Tier1FX’s own corporate funds. As such, in the event Tier1FX should become insolvent your funds would not be available to Tier1FX creditors. Funds in segregated accounts are often referred to as being “ring fenced” for protection. Tier1FX has selected leading qualified credit institutions, based on their prominent position in terms of regulation, protection of client’s funds and quality of provided service.