Central Bank of Ireland communicates its expectations of investment firms when engaging in unregulated activities

On 25 June 2020, The Central Bank of Ireland (the “Central Bank”) issued a letter (PDF 84.93KB) to MiFID firms outlining its expectations of investment firms when engaging in unregulated activities. The Central Bank is aware that some investment firms (“Firms”) are offering products and services considered to be outside of the scope of regulation. Where Firms engage in both regulated and unregulated activities, there is a significant risk that clients may misunderstand the protections they are afforded when investing in unregulated products. As a consequence, Firms must ensure they are acting fairly, professionally and in accordance with the best interests of their clients at all times.

Firms should take all necessary measures to ensure that clients are fully aware of the regulatory status of the product/service they are receiving. Firms should clearly disclose to clients when regulatory protections do not apply to the product or service provided.