Grandis Securities Ltd is a member of the Investor Compensation Fund (ICF) for customers of Cypriot Investment Firms (CIFs) and other Investment Firms (IFs), which are not credit institutions.
The Investor Compensation Fund for IF Clients (“ICF”) is the Fund of its members, established pursuant to Article 59(1) and (2) of Law 144(Ι)/2007 (the “Law”) and its powers and functions are regulated by the provisions of the said Law and CySEC Directive 144-2007-15 for the Continuance of the Operation and the Operation of the IF Investor Compensation Fund (the “Directive”).
The main purpose of the Investor Compensation for clients of Cypriot Investment Firms is to secure the claims of the ‘Covered Clients’ against Cypriot Investment Firms, in situations where the latter is unable to meet such of its duties as arise from its Clients’ claims in connection with the investment services or the ancillary services it has provided, as long as such inability is directly related to its financial circumstances in respect of which no realistic improvement in the near future seems foreseeable.
The Fund compensates the covered clients for claims arising from the covered services provided by its members, so long as failure by the member to fulfill its obligations has been ascertained.
Failure by a member to fulfill its obligations consists of its failure:
- Either to return to its covered Clients funds owed to them or funds which belong to them but are held by the member, directly or indirectly, in the framework of the provision by the said member to the said Clients of covered services, and which the latter requested the member to returns, in exercise of their relevant right;
- Or to hand over the covered Clients’ financial instruments which belong to them and which the member of the Funds holds, manages or keeps on their account, including the case where the member is responsible for the administrative management of the said financial instruments.
The ICF covers the clients of its members, excluding those set out below.
Additionally, the legal framework provides that persons who are subject to an ongoing criminal investigation in accordance with the provisions of Prevention and Suppression of Money laundering Activities Law of 2007, as amended from time to time, are not eligible to receive any compensation until the completion of such proceedings.
Subject of provisions of subsection (2) of Paragraph 3 of the Directive, the ICF does not compensate the following investor categories:
- Institutional and professional investors falling in the categories below:
· Investment firms
· Legal entities associated with the Company and, in general, belonging to the same group of companies
· Cooperative credit institutions
· Insurance companies
· Collective investment organisations in transferable securities and their management companies
· Social insurance institutions and funds
· Investors characterized by the Company as professionals
- States and supranational organisations.
- Central, federal, confederate, regional and local administrative authorities.
- Enterprises associated with the Company.
- All staff of the Company, inclusive of Managerial and Administration staff.
- Shareholders of the Company whose participation directly or indirectly in the capital of the member of the Fund amounts to at least 5% of its share capital, or its partners who are personally liable for the obligations of the member of the Fund, as well as persons responsible for carrying out the financial audit of the member of the Fund as provided by the Law, such as qualified auditors.
- Investors having an enterprise connected with the Company and in the general group of companies to which the Company belongs, positions or duties corresponding to the ones listed in paragraphs 5 and 6 above.
- Second-degree relatives and spouses of the persons listed in paragraphs 5, 6 and 7 as well as third parties acting for the account of these persons.
- Apart from investors convicted of a criminal offence pursuant to the Prevention and Suppression of Money Laundering Activities Law of 1996 – 2000, investor-clients of the Company responsible for facts pertaining to the Company that have caused its financial difficulties or have contributed to the worsening of its financial situation or which have profited from these facts.
- Investors in the form of a company which, due to its size, is not allowed to draw a summary balance sheet in accordance with the Companies Law or a corresponding law of a Member State.
The maximum amount of compensation paid to applicants, who will be deemed as eligible for compensation, is twenty thousand (20.000,00) EUR. The said coverage applies to the total amount of claims by an applicant against an ICF member, irrespective of the number of accounts, the currency and the place of provision of the service.
Upon completion of the valuation, the Fund issues minutes listing the customers of the Company who are entitled to compensation along with the amount of money each one of them is entitled to receive. The Fund communicates this to CySEC and the Company within five working days from its issue. The Fund also communicates to each affected customer its finding no later than fifteen days from the issue of the minutes, determining the total compensation amount this customer is entitled to receive.
If the claimant, to whom the Fund communicates the total compensation amount which he is entitled, disagrees with the Fund’s decision he has the right, within ten days from the communication of the decision, to appeal to CySEC, justifying sufficiently his alleged claim.
The Fund is obliged to pay to each Covered Customer claimant the compensation within three months from sending to CySEC the minutes with the compensation beneficiaries.