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Financial Advisory and Intermediary Services Act 2002 (Act No. 37 of 2002)

Codes of Conduct

Code of Conduct for Authorised Financial Services Providers and their Representatives, involved in Forex Investment Business, 2004

Part II : General Prohibitions and Duties applying to Forex Investment Intermediaries

2. Prohibitions


A forex investment intermediary may not directly or indirectly—

(a) by means of any statement, promise, forecast or by any other action that it knows to be misleading or which is likely to be misleading —
(i) induce a client to enter into a mandate with the forex investment intermediary; or
(ii) induce the client to enter into any other agreement relating to forex investments;
(b) sell to or provide a third party with a client’s details, without the client’s prior written approval:
(c) charge the client any kind of fee for terminating a mandate other than accrued fees for services rendered before the termination;
(d) receive or intermediate on or deal with client funds in the Republic for purposes of forex investment without such funds being cleared under the applicable provisions of the Exchange Control laws;
(e) advise a client to deal in a self-directed forex account or, in the case of a managed forex account, deal on behalf of a client, where the minimum leverage applied to the client’s funds will on a regular basis exceed widely used industry norms;
(f) churn a client’s account for fees or commissions; or
(g) in the promotion or advertising of forex investments—
(i) quote hypothetical investment returns;
(ii) quote real investment returns applicable to a specific product for a period shorter than twelve months, or shorter than the existence of the managed forex account if it has been in existence for a period shorter than 12 months: or
(iii) state or imply that the investment performance of the forex investment intermediary or of a particular product, achieved in the past, will be repeated.