The FCA has today reacted to the Budget by putting forward a number of changes to its client money rules that will affect investment firms managing ISAs.
The Chancellor George Osborne altered rules surrounding ISAs as part of his savings and pension reforms back in March.
The regulator has set out proposals this morning which it is seeking to consult upon, and these will affect ISA managers who manage either stocks and shares ISAs or cash ISAs and hold, or wish to hold, those monies as client money.
The FCA summarised the key amendments as:
• requiring all investment managers who hold any money within stocks and shares ISAs to hold these sums as client money
• allowing investment firms who manage cash ISAs to op-into the CASS regime and elect to hold money in cash ISAs as client money, and
• excluding any money held as client money by ISA managers from rules preventing the use of unbreakable term deposits of longer than 30 days
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The regulator said it wishes the consultation to take in views from deposit takers of money held within ISAs managed by investment firms and consumers who currently have an ISA or may consider one in future.
The consultation ends on 25 June 2014 and changes to the ISA regulations will come into force on 1 July.
Read the full consultation document HERE.