EGYPT: FRA Develops Procedures to Enhance Protection of Securities Dealers Accounts

Friday November 1 2024

On 31^st October 2024, Financial Supervisory Authority has amended procedures to enhance the protection of accounts of clients of companies operating in the field of securities. The procedures included preventing any financial transfers between the accounts of clients of all companies operating in the field of securities, or financial deposits between clients’ accounts with the company, or deposits in those accounts by someone other than the account holder.

The decision was issued after holding an open dialogue with all relevant parties within a series of community dialogue sessions launched by the Financial Supervision Authority. During the past period, the Authority listened to the opinions of representatives of companies in the market, as the dialogue aimed to reach the correct application of procedures to enhance accounts and increase the protection of those dealing in the field of securities.

This came in light of the Financial Regulatory Authority’s follow-up of the commitment of companies operating in the field of securities and concerned with the provisions of the legislation regulating the fight against money laundering and financing of terrorism, in continuation of the Authority’s efforts to develop legislative and regulatory decisions regulating non-banking financial markets with the aim of developing and growing these markets, protecting the rights and interests of those dealing in them, and ensuring the absence of financial violations related to clients’ accounts in brokerage companies.

The decision prohibits any financial transfers between the accounts of clients of all securities brokerage companies, securities portfolio formation and management companies, or companies and entities licensed to act as custodians, operating in the field of securities, or financial deposits between clients’ accounts with the company, or deposits into those accounts by anyone other than the account holder.

The decision specified the persons authorized to make financial transfers between clients’ accounts with companies operating in the field of securities, or financial deposits between clients’ accounts, or deposits in those accounts, as it permitted transfers and deposits that take place between spouses and relatives up to the second degree, as the provisions of the legislation regulating the fight against money laundering and terrorist financing prevent any persons unknown to those parties from making financial transfers, or deposits in clients’ accounts, other than the account holder.

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