shares held with trustees non beneficial own, page-2

  1. 959 Posts.
    The fact that a share asset is held by a trustee or custodian doesn't necessarily mean there is the potential for an Opes Prime like situation to arise. It depends on the terms under which the asset is held and the nature of the trusteeship.

    The specific examples of two super investments you gave have to be a trustee or custodian relationship as superannuation assets cannot be held directly by the person for whose benefit the investment is made. The assets have to be held by a trustee of a superannuation fund. Superannuation funds also operate under a far stricter regulatory regime than the likes of Opes Prime and their assets can't become mixed with the assets and liabilities of the manager/trustee/custodian or used as security for liabilities.

    Of course it still pays to check the fine print as legal niceties are not always observed by get rich quick schemers (oops I meant investment promoters).

    In the case of some of the overseas brokers I share some of your concerns. In particular I looked at Interactive Brokers (which has had quite a few mentions on HC) and I was concerned that it was unclear (at least to me) as to the status of your investments in the event of Interactive Brokers insolvency especially if you hold a margin loan through them. Also, if you have any disputes with them you have to go through the United States legal system which is most definitely not a plus from my point of view.
 
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