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Early Monday, MF Global disclosed to regulators that it had failed to segregate clients' accounts, breaking fundamental Wall Street rules.
As a result of this investigation, selected service delivery sites will segregate clients by age to decongest service delivery sites and hopefully attract older, married men and men who are parents the type of clients who might be inhibited to undergo VMMC due to a lack of privacy.
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The new rule would strike down the exemption, known as the "alternative calculation," which contradicts a cornerstone of the industry to always segregate client cash.
Last Monday, it emerged that its US marketing partner, the broker PFGBest, had become the latest firm where supposedly segregated clients' money had disappeared.
In my oral and written testimony before three Congressional committees, I stated that it was the unlawful transfer of funds from clients' segregated accounts that led to the customer shortfall.
"Although I see them as segregated I think clients see the creativity I endorse within my page and want something more than 'just a model'".
Glibness aside, tech companies are now segregating data for certain clients.
"J.P. Morgan Securities committed a serious breach of our client rules by failing to segregate billions of dollars of its clients' money for nearly seven years," the agency's director of enforcement and financial crime, Margaret Cole, said in a statement.
Under the SEC's custody rule, in general, investment advisors who take responsibility for client assets must segregate them using an independent "qualified custodian". As with some other SEC rules, blockchain technology has moved the goalposts because it is so different than traditional technology.
Intermediaries should segregate their assets from those of their clients.
But even clients whose money was properly segregated may not be repaid in full.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com