Customer Account Review (CAR) & The Customer Knowledge Assessment (CKA)

What is CAR and CKA? The 2008 global financial crisis has led regulators to re-examine the sale and marketing of certain investment products. MAS has released new measures to further safeguard the interests of retail customers. These measures, which will take effect from 1 January 2012, apply to trading/investing in certain investment products generally called “Specified Investment Products” (“SIPs”). However, existing investors are encouraged to complete and return the assessments to avoid the risk of disruption to their trading/investing activities.

It is compulsory for broking firms to assess retail investors for relevant knowledge and experience in trading SIPs. These products have structures, features and risks that are relatively more complex and difficult to understand.The Customer Account Review (CAR) enables us to assess whether you can trade in listed SIP products. The Customer Knowledge Assessment (CKA) enables us to assess whether you have the relevant knowledge or experience to understand the risks and features of an unlisted SIP.

	Customer Account Review (CAR)	Customer Knowledge Assessment (CKA)
	The current list of listed SIP includes:	Unlisted SIP includes:
	Certificates Exchange Traded Funds (ETFs) Exchange Traded Notes (ETNs) Futures (Extended Settlement contracts) Structured Warrants Callable Bull/ Bear Contracts (CBBCs)* CBBC has yet to be launched Specified Investment Products listed on SGX derivatives market include: Futures Options Listed products ( not on the list of SGX securities) also include: Foreign shares	Contracts for Difference (CFDs) Unit Trusts & Mutual Funds Investment-linked Products (ILPs) Leveraged Forex

Who is affected

These new MAS requirements apply to all retail clients.
Affected retail clients will have to undergo the Customer Knowlege Assessment(CKA) & Customer Account Review(CAR).

Who is exempted

The following segments are exempted from the new MAS requirements and do not have to undergo the Customer Knowlege Assessment(CKA) & Customer Account Review(CAR).

1. Accredited Investors as defined in Securities and Futures Act(Cap. 289) section 4A
2. Expert Investors as defined in Securities and Futures Act(Cap. 289) section 4A
3. Institutional Investors as defined in Securities and Futures Act(Cap. 289) section 4A
4. High net worth individuals who are clients of private banks
5. Corporations, unincorporated entities, partnerships, or trusts.

Source: www.poems.com.sg