Protect Yourself

The Financial Supervision Commission ("the Commission") has regulatory objectives which are set out in law (see Financial Services Act 2008 – section 2).

One of these objectives is to secure an appropriate degree of protection for the customers of persons carrying on a regulated activity. The following information aims to assist customers and clients (both existing and potential) of those providing financial services in or from the Isle of Man to help them make informed decisions and reduce their risk.

There are many legal requirements for those wishing to operate financial services businesses in or from the Isle of Man and there are penalties for those who either operate such businesses without a licence, or who operate outside the terms of their licences. You can check whether the Commission has licensed the person you are dealing with by checking the list of licenceholders.

If you think someone is seeking to offer you financial products or services without a suitable licence, or outside the terms of their licence, please contact us via +44 (0)1624 689314 (telephone), +44 (0)1624 689399 (fax), or fsc@gov.im. We will be able to give you guidance on whether the person should be licensed by another body, or whether the financial product or service they are offering does not require a licence.

This website contains links to some of the legal requirements imposed on financial services businesses that are regulated by the Commission, many of which are contained within the Financial Services Rule Book. In particular, Part 6 of this Rule Book relates to how such financial services providers in the Isle of Man are required to deal with their customers and clients. Topics covered include fair dealing, advertising, risk assessment, valuation of investments, compensation schemes and client agreements. You are encouraged to consider whether any business with whom you are transacting meets these standards and requirements.

Those financial products and services for which a licence from the Commission is needed are listed in the Regulated Activities Order. Please note that general insurance and pensions are licensed by the Insurance and Pensions Authority, not by the Commission.

There are statutory compensation schemes on the Isle of Man for depositors in banks licensed on the Island and for investors in Authorised collective investment schemes. Details may be found via the Compensation Schemes page. A life assurance protection scheme is operated by the Insurance and Pensions Authority.

You may also wish to refer the website of the Isle of Man’s Financial Services Ombudsman Scheme

General tips for potential investors

• Is the person - including website - with whom you are dealing ("the intermediary"), licensed and supervised by a regulatory authority?

• Is the intermediary experienced and has he/she/it been in business for a long time? If not, you should find out why.

• Have you read the terms of business (in particular any small print), any associated risk warnings or agreements before you commit to or sign any undertaking?

• If you do not understand what has been shown to you, have you consulted a professional adviser?

• Has the intermediary disclosed to you the charges which may be levied/commission which you have to pay?

• Have you been given a period in which you can change your mind, when committing to a long term contract?

• If managing or advising on your investments, has the intermediary sought details about your financial circumstances and asked you how you wish to plan the future? Have they asked about your attitude to risk and explained how the product is suited to that attitude?

• Before signing a long-term contract, make sure that you are fully content in case your plans change. You should be aware of any penalties for early termination, which may be significant.

• Is there a compensation scheme to provide some protection, in the event that the company or fund with whom you invest ceases to trade?