Dáil Éireann Debate, Wednesday - 17 January 2018
59. Deputy Pearse Doherty asked the Minister for Finance the number, nature and results of investigations carried out by the Central Bank into the mis-selling of hedge fund products by financial institutions here; and if he will make a statement on the matter. [2213/18]
Amharc ar fhreagraI am informed by the Central Bank that, to date, it has not undertaken an investigation into the sale of hedge fund products by financial institutions in the State.
As per Central Bank rules, Hedge Funds authorised in Ireland (known as “Qualifying Investor Alternative Investment Funds” – QIAIFs) can only accept subscriptions from investors who:
- Are professional clients as defined in MiFID; or
- Are investors who have the appropriate expertise, experience and knowledge to understand the proposed investment.
QIAIFs shall not accept subscriptions of less than €100,000 from individual investors. An exemption from the minimum subscription requirement of €100,000 is granted to certain categories of investors as set out in the Central Bank's AIF Rulebook (available at the following link: www.centralbank.ie/docs/default-source/Regulation/industry-market-sectors/funds-service-providers/aifm/AIFM/aif-rulebook-march-2017-(002).pdf). The QIAIF must ensure that such investors self-certify that they are availing of the exemption provided for and that they are aware that the QIAIF is normally marketed solely to qualifying investors who are subject to a minimum subscription of €100,000.
When selling financial services products, regulated entities are subject to the conduct of business rules as set out in the European Union (Markets in Financial Instruments) Regulations 2017 (MiFID II), or the Consumer Protection Code 2012, where appropriate.
