As part of CIFSA’s continued drive and commitment to ensure high standards of practice in the Cyprus-regulated IFA and financial services industry, it is a condition of membership for IFA firms that they commit to abide by the CIFSA Charter.
By completing an application form for membership, and following acceptance, IFA member firms are deemed to have agreed and accepted The CIFSA Charter in its entirety.
The CIFSA Charter sets out the standards required in order to uphold and enhance the reputation of the industry and provides a further insight for the General Public into the standards and ethics CIFSA endeavours to promote and encourage member firms to practise at all times.
Each member firm commits to such standards by way of a Director’s signature on the updated Charter which should accompany membership renewals. For the avoidance of all doubt, prior to any renewal(s), a member firm is deemed to have accepted The Charter upon initial application.
CIFSA reserves the right to refuse, remove without notice or otherwise decline a membership or renewal application should the proposing firm fail to commit to The Charter, or fail to take all reasonable steps in order to comply with such commitment. Furthermore, CIFSA reserves the right to refuse to deal with any lodged complaint with the intention of assisting resolution where a member has directly and knowingly acted against the Charter.
For the purposes of the items detailed below, and for the avoidance of all doubt, “The Firm” includes all individuals representing the member firm.
The CIFSA Charter
“The Firm” shall observe high standards of integrity and fair dealing in the provision of its services and its market conduct, including compliance with any rules, standards or guidelines as they apply to firms and in accordance with the terms and conditions of its Licence.
“The Firm” shall act with due skill, care and diligence at all times, and take all reasonable steps to ensure that sufficient information has been obtained to enable “The Firm” to make any recommendations to, or act on any instructions from, a client or potential client.
“The Firm” shall seek from the clients it advises, or for whom it exercises discretion, any information about their circumstances and investment objectives which might reasonably be expected to be relevant in enabling it to fulfill its responsibilities to them.
“The Firm” shall take reasonable steps to give the clients it advises, in a comprehensive and timely fashion, any information needed to enable them to make a balanced and informed decision. In this regard “The Firm” must not recommend a transaction to a client, or act as discretionary manager for him (if appropriately authorised), unless it has taken reasonable steps to enable him to understand the nature of the risks involved.
“The Firm” should similarly be ready to provide a client with a full and fair account of the fulfilment of its responsibilities to him.
“The Firm” shall either avoid any conflict of interest arising or, where conflicts do arise, ensure equal treatment for all its clients by disclosure, internal rules of confidentiality, declining to act, or any other appropriate action.
“The Firm” should not unfairly place its interests above those of its clients and, where a properly-informed client could reasonably expect that “The Firm” would place his interests above its own, “The Firm” should live up to that expectation.
“The Firm”, where it has control of, or is otherwise responsible for, the safeguarding of assets belonging to a client, shall arrange proper protection for them by way of segregation, specific identification or any other suitable method, in accordance with the responsibility it has accepted.
“The Firm” shall ensure that it maintains adequate financial resources to meet its business commitments and to withstand the risks to which its business is subject.
“The Firm” shall organise and control its internal affairs in a responsible manner and ensure that it has well-defined procedures to facilitate compliance with regulatory requirements. Where “The Firm” employs staff or is responsible for the conduct of business by others, it should have adequate arrangements to ensure that they are suitable, adequately trained and properly supervised and that it has well-defined compliance procedures.
“The Firm” shall deal with its regulator in an open and co-operative manner and keep it promptly informed of anything concerning “The Firm” which it might reasonably expect to be disclosed to it.
“The Firm” shall deal with CIFSA in its role as mediator, or in its endeavour to resolve a complaint, in a co-operative manner, and provide all necessary information to assist CIFSA to achieve complaint resolution in a timely manner. Reasonable requests for information in connection with complaint resolution should be provided within a period not exceeding 14 days. Furthermore, “The Firm” shall ensure that adequate authority is obtained from its client to release such information to CIFSA.
“The Firm” shall ensure Terms of Business documents are available and actively provided to clients/potential clients, in order that they may have a comprehensive overview of the services offered and have sufficient information available in order to make an informed decision or comparison. This document should include, but is not limited to, details regarding levels/scope of service, regulation, complaint handling, client money procedures, data protection and release of information, record keeping, termination, and contact details.
“The Firm” shall ensure that reasonable steps are taken and processes put (and maintained) in place to ensure that any staff member recruited is or can be reasonably considered to be honest, trustworthy, and of integrity. These processes should include, but are not limited to, ensuring the identity and address of any individual is accurate, requesting and maintaining on file proof of a clear criminal history, requesting and maintaining on file proof of acceptable conduct in the individual’s personal finances, confirmation of an individual’s employment history, and confirmation by way of certificates of the individual’s professional qualifications. This process should fall in line with the ‘fit and proper’ guidelines issued by the regulator.
“The Firm” shall ensure that Anti-Money Laundering requirements are met and appropriate measures are in place to ensure relevant staff can meet this commitment, are kept adequately trained and are updated from time-to-time by a suitably qualified person.
“The Firm” shall ensure that Professional Indemnity Insurance to a standard/level approved by the relevant regulator is and remains in place.
“The Firm” shall commit that it shall not actively aim or set out to tarnish, or attempt to tarnish, the reputation of any other member firm. In its dealings with the general public or colleagues, “The Firm” or its representatives shall not in any way suggest shortcomings in other companies, invite complaints, or act in any other way which may be considered as detrimental, defamatory or suchlike to another member firm.
“The Firm” shall ensure that clients are made aware of any risks/responsibilities they take on, especially with regard to the selection of underlying investments, the scope of the Insurance Mediation Directive and/or MiFID, the limits to which it/they apply(ies), and the limits to which “The Firm” accepts responsibility and/or liability for any recommendations. “The Firm” should make clear at all times the capacity in which it acts in this regard, and clients should be made aware of the level of service the firm is offering.