IB registration - financial institution

I tried opening an account at IB and there is a question whether I work for a financial company.

I work for an investment foundation, we sell our own funds to private and institutional clients. However the funds are not managed by us, instead they are managed by a bunch of different, independent asset managers.

The definition from IB is not clear enough for me to tell whether this counts as a financial institution.

What do you think?

What you’re describing sounds like a financial company, why not just reply yes?

Because then they need to get the approval of my employer and may even need to send the transactions.

I don’t really care, but seems a bit overkill in my opinion.

Selling your “own” funds?
I’d certainly not negate working for a financial institution based on anonymous online advice then.

https://ibkr.info/article/1160

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I would declare that I work for a financial institution but declare that FINRA Rule 3210 does not apply, so I don’t have to get permission from my employer (would never do that) and also not data has to be sent to them.

In Switzerland, this procedure is very unusual.

There are banks that prohibit all employees to have accounts with another banks so they must have everything in-house which makes it easier for the control room to monitor transactions.

Other banks, are quite open or even suggest to have accounts with other banks too, especially in areas where colleagues potentially have access to your account data (e.g. reporting functions, etc.). Usually there employees are categorised into 3 categories: free to trade (because no access to relevant information), trades must be reported (there is usually a tool to report own trades), or trading prohibited (the only way around this is a discretionary mandate where someone else manages your portfolio and you are not involved in the decision making).

So it’s up to the employee to conform with the employers requirements and not a third party such as a IBKR to enforce it or send information to the employer. This is probably just US protectionist stuff and it doesn’t work like that in CH.

So based on that I would argue to be exempted from FINRA Rule 3210 and such reporting, whatever that FINRA rule means in detail, but I don’t think it’s relevant for a CH financial institution.

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They are only sold to pension funds or 3rd pillar clients.

I assume that this whole thing is to avoid that people do front/parallel running of trades or similar prohibited trading practices, because they have some informational advantage/insider information, which is definitely not the case for me.

That’s a great idea, I will try that.

I opened the account in the meantime and it looks like everything got accepted and I’ll be able to trade as soon as my funds arrive there. I asked our compliance officer and he did not receive any communication from IB.

I have now the same problem. I have opened an account and besides funding, ID, address verification, there is now a pending item “Employer Authorization for Mr. XXX”. It looks like it’s waiting for my employer’s compliance officer to fill out a form and send it to IBKR??

Did you manage to get that dropped? I really do not wish to get to my compliance department and have them to fill out some forms etc.

I received a notification from IB with instructions on what I need to send to my conpliance officer. I prepared everything to send it on the following Monday.

Then suddenly I got a notification from IB that the registration is now complete and I can start trading. I asked our compliance officer whether he received anything or not, but he did not receive anything. Maybe they noticed during the process that it doesn’t apply to me.

I was able to transfer money and invest it successfully.

Interesting. So maybe I’ll wait and see.

But I’m not ready to ask my employer for an approval to open an account with anyone and I also don’t want any data sent to them. If they’ll insist on it I’ll probably withdraw the application.

So I hope the account gets approved without it.

Just wait, for me it was a matter of 2 working days until they approved everything.

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Account was approved without employer authorisation :wink:

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