From the latest upgrade on segregated accts , this is purely wrong and states that the trader might be ok when his money is in the segregated acct but if u have an open position and your cash isn't in the segregated acct u have increased risk . I hope it isn't the same for MF clients with open positions ;
11 Client money 11.1 Introduction to client money Any money received from you will be deposited and held by us on trust in a segregated trust account established, maintained and operated in accordance with the Australian Client Money Rules. Your money may be held in one or more trust accounts with our other clients’ money. We will not be liable for the solvency or any act or omission of any bank holding the trust accounts. All client money held by CMC Markets is fully segregated. This means that all client money, including Margin, is held on trust in the segregated trust account. We do not use client money for the purpose of meeting obligations incurred by us when hedging with other counterparties. Any obligations incurred by us in connection with such transactions are funded by CMC Markets from our operating cash account. In addition, client money is not used to meet the trading obligations of other clients. We may invest any of the money held in trust as permitted by the Australian Client Money Rules, and you irrevocably and unconditionally authorise us to undertake any such investment. Unless otherwise agreed in writing: • we will be solely entitled to any interest or earnings derived from the client money being deposited in a segregated trust account or invested by us in accordance with the Australian Client Money Rules with such interest and earnings being payable from the segregated trust account as and when we determine; • upon realisation of an investment of client money, the initial capital invested must either be invested in another investment permitted by the Australian Client Money Rules or deposited by us into a segregated trust account operated in accordance with Australian Client Money Rules; • in the event that the amount received upon realisation of an investment of the client money is less than the initial capital invested, we will pay an amount equal to the difference into a segregated trust account for the benefit of the client, except where any such difference is the result of amounts paid out of the investment to us in accordance with the terms of this PDS; • we will not charge a fee for investing client money in accordance with the Australian Client Money Rules; and • you authorise us to withdraw, deduct or apply any interest or earnings derived from your money held in any segregated trust account or invested by us. This includes: - making payment for, or in connection with the adjusting or settling of dealings in CFDs; - the payment of Financing Charges, Commissions or interest to CMC Markets, its Associates or other Persons connected with CMC Markets from the relevant segregated trust account or investment account, as the case requires and as CMC Markets determines; or - to pay, withdraw, deduct or apply any amounts from your moneys held in any segregated trust account or invested
and then this ;
11.2 Protections afforded by the Australian Client Money Rules In accordance with the Australian Client Money Rules, any money received by us on your behalf in relation to dealings in CFDs must be paid into a segregated trust account on the day it is received by CMC Markets, or the next business day. As soon as that money is deposited into that account, it is protected in the event, for example that CMC Markets became insolvent, merged with another licensee or ceased to carry on some or all of the activities authorised by the licence. Money withdrawn or deducted from the segregated trust account in accordance with section 11.1 is not protected. In addition, until your realised and unrealised profits are moved into the segregated trust account (which occurs on a daily basis), they are not protected in the same way. As CMC Markets is the product issuer, you are exposed to the financial and business risks, including credit risk associated with trading with CMC Markets. If CMC Markets were to become insolvent, CMC Markets may be unable to meet some of its obligations to you. Refer to Section 12.7 for more information about counterparty risk. In the event that the above occurred, money would be dealt with as follows: • money in the segregated trust accounts is held on trust for the Persons entitled to it, and is payable in the order set out below in the third bullet point; • if money in the segregated trust accounts is invested, the investment is likewise held in trust for each Person entitled to money in the account; and • money in the segregated trust accounts would be paid in the following order: (a) money that has been paid into the accounts in error; (b) payment to each Person who is entitled to be paid money from the accounts; (c) if there is not enough money in the accounts to be paid according to the above paragraphs, the money in the accounts must be paid in proportion to the amount of each person’s entitlement; and (d) if there is money remaining in the trust accounts after payments made according to the above paragraphs, the remaining money is payable to CMC Markets. 11.3 Withdrawal of money from your Account You may withdraw money from your Account using the withdrawal
