Product Disclosure Statement
United States & Canada (January 2014)
Global Payment and Risk Management Solutions
Product Disclosure Statement - United States & Canada
January 2014
Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Trade Confirmations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Telephone Recordings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Complaints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Privacy Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Fraud Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Contact Us . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
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Product Disclosure Statement - United States & Canada
January 2014
Introduction
This Product Disclosure Statement (PDS) contains
information about the Global Payment and Risk
Management Solutions provided to you by AFEX.
The information set out in this PDS is general in nature
and has been prepared without taking into account your
objectives, financial situation or needs. Before dealing
in foreign exchange transactions you should consider
whether it is appropriate, having regard to your own
objectives, financial situation and needs. This PDS does
not constitute financial or legal advice, including financial
recommendations.
If you need legal advice, please seek the services of an
attorney.
If you have any questions or need more information, please
contact your AFEX Account Executive or visit our website at
www.afex.com.
Trading in foreign exchange and foreign exchange derivative
products involves the potential for gain as well as the risk
of loss. In some cases, that loss may exceed the amount of
money you commit to a transaction. Movements in the price
of foreign exchange rates are influenced by a variety of
factors many of which are unpredictable. AFEX is unable to
guarantee a maximum loss that you may suffer from trading.
You are not obliged to use any products described in this
PDS unless you have a comprehensive understanding how
they work, including the risks and the costs involved.
Changes to this PDS
Information in this PDS that is not materially adverse to
users of our products is subject to change and may be
updated via our company website (see our contact details
on the cover page of this PDS). You can access that
information by visiting the website, or otherwise contacting
us and asking for an electronic or paper copy, which will be
provided free of charge. You can also access the website
which may contain, from time to time, other information
about our products. We may make other information about
our products available to you, and that information may also
be accessed for free from our website or by contacting us
by phone or email.
About AFEX
Associated Foreign Exchange, Inc. (AFEX), a California
Corporation located at Warner Center, 21045 Califa
Street, Woodland Hills, California 91367 United States, is
licensed and regulated as a Money Transmitter by several
State Regulatory Agencies, and it is registered as a Money
Services Business (MSB) with the Financial Crimes
Enforcement Network (FinCEN), a bureau of the United
States Department of the Treasury Financial. In addition,
AFEX is also registered with the Financial Transactions and
Reports Analysis Centre of Canada (FINTRAC).
Established in 1979, AFEX effectively pioneered the
business of personalized foreign exchange services,
tailored to small and mid-size business clients. AFEX is
wholly owned by Associated Foreign Exchange Holdings,
Inc. a California Corporation, with subsidiaries in multiple
jurisdictions, including the United States, United Kingdom,
Australia, Switzerland, etc.
Products
Foreign Exchange Transactions
In general terms foreign exchange is the conversion of one
currency to another at an agreed exchange rate. A foreign
exchange transaction is a binding agreement between you
and AFEX in which one currency is sold or bought against
another currency at an agreed exchange rate on the current
date or at a specified future date. The day that you order
your currency is referred to as the Trade Date; the day that
you are required to make payment for your currency (and
the day that we exchange currencies) is referred to as the
Value Date. AFEX offers the following three types of foreign
exchange transactions:
• Value Today – refers to transactions where the Value
Date and the Trade Date are the same day.
• Value Tomorrow – refers to transactions where the Value
Date is one business day after the Trade Date.
• Value Spot – refers to transactions where the Value Date
is two (2) business days after the Trade Date.
In addition to these transactions we also offer a foreign
exchange product that is settled beyond two business days.
This is referred to as Forward Exchange Contracts.
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Product Disclosure Statement - United States & Canada
How does a Foreign Exchange Transaction work?
When you enter into a foreign exchange transaction you
nominate the amount of currency to be bought or sold,
the two currencies to be exchanged and the type of trade
(Value Today, Value Tomorrow or Value Spot). The currencies
that you wish to exchange must be on the list of available
currencies provided by AFEX.
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January 2014
The currency pair
Market volatility and liquidity at the time of the transaction
Availability of currency in the market.
The tenor (or value date) of the currency exchange.
Interest rate differentials between the two
currencies involved.
AFEX will determine the exchange rate applicable to the
trade based on the currencies and the Value Date that you
have nominated. On the Value Date it is essential that you
deliver the currency you are exchanging in accordance with
the exchange rate determined by us and agreed by you at
the time the trade was entered into.
The exchange rate that AFEX provides you for Value Today
and Value Tomorrow transactions are based on the standard
market convention of reflecting the interest rate differential
between the currencies that are being exchanged. This
adjustment can be either an addition or subtraction and
reflects the costs or benefits associated with the interest
rate differential between the currencies that are being
exchanged.
Upon receipt AFEX will pay you or your nominated
beneficiary the amount of currency that you have purchased.
Exotic Currency Spot Value Contracts
How is the foreign exchange rate determined?
A foreign exchange rate is the price of one currency (the
Base Currency) in terms of another currency (the Terms
Currency). A quotation shows how many units of the Terms
Currency will equal one unit of the Base Currency. For
example the foreign exchange rate AUD/USD 0.7215
means one Australian dollar is equal to 72.15 US cents. In
this example, the Australian dollar is the Base Currency and
the US Dollar is the Terms Currency.
Exchange rates are quoted on the interbank market and
fluctuate according to supply and demand. This market is
restricted to authorized exchange dealers and banks that
constantly quote to each other at wholesale rates and in
minimum parcel sizes.
Factors that influence supply and demand include:
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Investment inflows/outflows
Market sentiment or expectations
Economic and political influences
Import/export of goods and services
Exchange rates quoted in the media generally refer to
interbank rates and will usually differ from exchange rates
quoted to you. Interbank rates do not reflect the levels at
which AFEX buys or sells currency. Rates of exchange
obtained by AFEX and in turn offered to its customers are
dependent upon the following factors:
If you intend to purchase an Exotic Currency (and you will be
informed at the time of booking by your Account Executive
whether the currency you are buying is an Exotic Currency),
you are merely permitted to book for delivery on the Spot
Value Date and need to make payment for this purchase
on or before 1pm Pacific Time of the Trade Date. Failure to
do so may result in the Exotic Currency you had purchased
being sold back and the resulting loss (if any) being charged
to you.
The client is required to provide correct and complete bank
instructions prior to the trade. The trade may take place only
upon approval of the bank instructions by AFEX.
By entering into an Exotic Currency Spot Value Contract,
you have removed the uncertainty of exchange rate
movements over the next two Business Days. In exchange
for this exchange rate certainty you have relinquished the
opportunity to take advantage of any favorable exchange
rate movements between the Trade Date and the Spot Value
Date.
In addition to this Exotic Currencies are illiquid, i.e. they have
low trading volumes and therefore market movements in
these environments can be amplified and unpredictable. This
increased level of risk represents a high cost to carry for
trading entities and complicates the unwinding of existing
currency positions.
The differences between the bid and ask prices for exotic
currencies tend to be significantly wider compared to the
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Product Disclosure Statement - United States & Canada
major currencies. This combination of illiquidity and a lack
of inherent price stability have an adverse effect on exotic
currency pricing. In turn, this heightens volatility, which
poses a significant risk to any trading entity. Market volatility
can be higher by a margin of several hundred percent,
depending on socio-economic and political conditions or the
prevalent investment climate in the respective jurisdiction. If
a transaction has to be sold back to the currency market, the
probability for substantial losses is significantly increased.
January 2014
beneficiary bank(s) which facilitates the sending or payment
of a wire transfer/drafts may impose their own additional
fees or charges which may be deducted from the amount
paid to you or your beneficiary. These fees are at the
discretion of those institutions and AFEX does not control,
set or benefit from such fees.
For further information in relation to the cost of wire
transfers and drafts in connection with a foreign exchange
transaction, please contact your Account Executive at AFEX.
Settlement and delivery of a Foreign Exchange Transaction
On the value date for your trade it is vital to deliver the
currency that you are exchanging in accordance with the
exchange rate determined by AFEX and agreed by you at
the time the trade was entered into. Upon receipt of cleared
funds AFEX will pay you or your nominated beneficiary the
amount of currency that you have purchased.
AFEX can deliver payment to you or your nominated
beneficiary either by initiating a wire transfer to a bank
account or through the physical delivery of a draft in
accordance with your instructions to AFEX.
Cost of a Foreign Exchange Transaction
When you enter into a foreign exchange transaction, you
agree to make a payment of one currency to AFEX in
exchange for the receipt of another currency. The amount
that you pay to us is determined by the exchange rate that
we agree.
You will not be charged any additional entry fees for a
foreign exchange transaction but other fees or charges may
apply for related services such as wire transfers or drafts
that are made in connection with the foreign exchange
transaction.
The transaction fee we charge you for these services will
vary based on:
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AFEX fixed costs for fulfilling the transaction.
Volume and frequency of wire and / or draft payments.
The relevant currency involved
The country to which the funds are being sent
Your Account Executive will advise you of any transaction
fees before you begin trading. In addition to the fees
charged by AFEX for sending payments by wire transfer
or for issuing drafts, any correspondent, intermediary or
Forward Contracts
A forward Contract is a binding agreement between you
and AFEX in which one currency is sold or bought against
another currency at an agreed exchange rate on an agreed
date beyond two (2) business days in the future. AFEX
offers the following three types of Forward Contracts:
Window Forward Contracts
Window Forward Contracts exchange one currency for
another at a specified and agreed Foreign Exchange Rate
for a Value Date between three Business Days and one year
after the Trade Date and allow you to access your foreign
currency at any time within the Window Period.
The exchange rates quoted for Value Dates different from
the Spot Value Contract are determined by adjusting the
Spot Exchange Rate by Forward Points.
By entering into a Window Forward Contract you have
removed the uncertainty of exchange rate movements
until the settlement of the contract. In results to this
exchange rate certainty you relinquish the opportunity to
take advantage of any favorable exchange rate movements
between the Trade Date and the Value Date. In addition, with
a Window Forward Contract, you may utilize any portion of
the currency purchased at any time up to the Value Date of
the contract, once that currency has been paid for.
Outright Forward Contracts
Outright Forward Contracts exchange one currency for
another at a specified and agreed Foreign Exchange Rate
for a Value Date between three Business Days and one year
after the Trade Date and have a fixed future date as the
Value Date.
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Product Disclosure Statement - United States & Canada
The exchange rates quoted for settlement dates different
from the spot value contract are determined by adjusting the
Spot Exchange Rate by Forward Points.
By entering into an Outright Forward Contract you have
removed the uncertainty of exchange rate movements over
the next Business Days. In exchange for this exchange rate
certainty you have lost the opportunity to take advantage of
any favorable exchange rate movements between the Trade
Date and the Value Date.
Exotic Currency Forward Contracts
If you intend to purchase an Exotic Currency for a value date
later than the Spot Value Date (and you will be informed
the time of booking by your Account Executive whether the
currency you are buying is an Exotic Currency), you will be
entering into an Exotic Currency Forward Contract.
The client is required to provide correct and complete bank
instructions prior to the trade. The trade may take place only
upon approval of the bank instructions by AFEX. Following
approval the trade will take the form of an Outright Forward
Contract.
In addition to the risks and benefits of the applicable type of
Forward Contract, Exotic Currencies are illiquid, i.e. they have
low trading volumes and therefore market movements in
these environments can be amplified and unpredictable. This
increased level of risk represents a high cost to carry for
trading entities and complicates the unwinding of existing
currency positions.
The differences between the bid and ask prices for exotic
currencies tend to be significantly wider com- pared to the
major currencies. This combination of illiquidity and a lack
of inherent price stability has an adverse effect on exotic
currency pricing. In turn, this heightens volatility, which
poses a significant risk to any trading entity. Market volatility
can be higher by a margin of several hundred percent,
depending on socio-economic and political conditions or the
prevalent investment climate in the respective jurisdiction. If
a transaction has to be sold back to the currency market, the
probability for substantial losses is significantly increased.
How does a Forward Contract work?
When you enter into an a forward contract you nominate the
amount of currency to be bought or sold, the two currencies
to be exchanged and the date that you wish to exchange
January 2014
the currencies (the Value Date). The currencies that you
wish to exchange must be on the list of available currencies
provided by AFEX. For a list of available currencies please
contact your Account Executive at AFEX.
AFEX will determine the exchange rate applicable to the
forward contract based on the currencies and the Value
Date that you have nominated.
With the exception of a Non-Deliverable Forward (NDF) on
the Value Date it is essential that you deliver the currency
you are exchanging in accordance with the exchange rate
determined by AFEX and agreed by you at the time the
forward contract was entered into. Upon receipt AFEX
will pay you or your nominated beneficiary the amount of
currency that you have purchased or sold.
Purpose of Forward Contracts
Forward contracts allow parties to fix exchange rates. This
allows you to Hedge your currency exposure by providing
protection against unfavorable currency movements
between the time that you enter into a forward contract and
the Value Date. It may also assist you in managing your cash
flow by negating the uncertainty associated with exchange
rate fluctuations for the certainty of a specified cash flow.
Benefits of Forward Contracts
Forward contracts may help you manage the risk inherent
in currency markets by predetermining the rate and date on
which you will purchase or sell a given amount of foreign
currency against another currency. This can provide you with
protection against negative foreign exchange movements
between the time that you deal and the Value Date. This
may also assist you in managing your cash flow by negating
the uncertainty associated with exchange rate fluctuations
for the certainty of a specified cash flow.
In addition, Value Dates and amounts can be tailored to
meet your requirements.
Risks Associated to Forward Contracts
AFEX considers that forward contracts are only suitable
for Clients who understand and accept the risks involved in
investing in financial products involving foreign exchange
rates. AFEX recommends that you obtain independent
financial and legal advice before entering into a forward
contract. The following are the significant risks associated
with a forward contract:
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Product Disclosure Statement - United States & Canada
• Forward contracts may not be cancelled by the Client
once entered into with AFEX in accordance with the
product’s terms and conditions.
• Any margin amounts associated to forward contracts are
non-refundable.
• The foreign currency market is volatile. If the purchased
currency weakens during the period covered by the
forward contract, the value of the amount of currency may
be less favorable than the current price for the purchased
currency.
• Forward contracts purchased from AFEX are not
transactions subjects of the Commodities Futures Trading
Commission.
Additional Requirements
Each forward contract which you enter into will be subject to
the Terms and Conditions for doing business with AFEX. It is
only after signing these documents that the client is eligible
to enter into a forward contract for the first time.
In addition to the Master Forward Contract Agreement,
you may also need to provide us with the following signed
documentation together with such other “Know your
Customer” information that AFEX may require:
January 2014
Dodd-Frank Client Notification
Under Title VII of the Dodd-Frank Wall Street Reform
and Consumer Protection Act (“Dodd-Frank”), wideranging measures were introduced designed to introduce
transparency and accountability to the financial markets.
Some of these regulations include foreign exchange
products, such as Forwards.
Regulatory obligation requires all financial institutions to
collect and maintain certain Client information, in order to
provide continued access to forward contracts Clients may
entered into with AFEX. Under the new regulations, all
Clients are responsible for obtaining a Legal Entity Identifier
(LEI), currently known in the United States as a CFTC
Interim Compliant Identifier (CICI).
A CICI is a unique code associated with a single legal entity
in accordance with the ISO 17442 standard. The CICI is
a reference data tool to standardize how a counterparty
is identified on financial transactions. Its goal is to help
improve the measuring and monitoring of systemic risk and
support more cost-effective compliance with regulatory
reporting requirements.
AFEX’s CICI is: 549300MV57LPASV8US90.
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Margin Call Agreement
Legal Entity Identifier Information Request form
Bank reference form
Audited financial statements
(no more than 12 months old)
• Direct Debit Request form
• A Partial Prepayment at the time the forward contract is
booked
Upon completion of these documents, AFEX will conduct
an accreditation process. Accreditation and acceptance of a
client is at AFEX’s sole discretion. The main checks that are
relevant to the accreditation of a client are:
• Verification of a Client’s identity in accordance with
relevant AML laws.
• A successful credit check conducted through a third party
credit agency.
• An AML risk assessment considering relevant factors
such as the nature of a Client’s business and the country
where the Client will make or receive payments.
• A check of a client’s principal officers and beneficial
owners against relevant government issued sanction lists.
The registration website to obtain this number is https://
www.ciciutility.org/. The following is a link that details the
purpose behind the LEI/CICI, as required by the regulation
http://www.dtcc.com/products/dataservices/lei.php.
Significant Benefits of Our Products
In addition to the benefits already outlined in this PDS, the
significant benefits of using our products are:
• Manage Volatility
We can offer products that manage the risk that the
Foreign Exchange Rate will move in an adverse direction.
• Provide Cash Flow Certainty
Depending on the products chosen, Foreign Exchange
Transactions generally allow you to agree to a rate of
exchange now, for a time in the future. This will help
you to determine the exact cost of that currency, giving
certainty over the flow of funds.
• Tailored and Flexible
We can tailor the transaction to meet your specific
circumstances. Unlike exchange traded products, our
over-the-counter contracts are not standardized and
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Product Disclosure Statement - United States & Canada
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can be personally tailored to suit your requirements. For
example, AFEX allows you to enter into transactions in
small amounts and the Value Date is negotiable, whereas
exchange traded products are a standard size and cannot
be varied in duration.
Virtual 24 Hour Trading
We offer an on-line platform that helps you trade simply
and easily, 24 hours a day.
High Level of Liquidity
The foreign exchange market is very liquid enabling
AFEX to efficiently manage its risks by entering into
transactions with its hedging counterparties. The liquidity
comes mainly from large and smaller banks that provide
liquidity to investors, companies, institutions and other
currency market players.
Real time quotes
AFEX uses sophisticated technology and/or liquidity
providers (counterparties) in order to offer you up-to-theminute quotes.
Trade Confirmations
The commercial terms of a particular foreign exchange
transaction will be agreed and binding at the time of dealing.
This may occur verbally over the phone, electronically or in
any other manner set out in our Terms and Conditions for
doing business with AFEX.
Shortly after entering into a foreign exchange transaction,
AFEX will send you a Trade Confirmation outlining the
commercial terms of the deal; this Confirmation is intended
to reflect the transaction that you have entered into with
AFEX. It is important that you check the Confirmation
to make sure that it accurately records the terms of the
transaction. In the event that there is a discrepancy between
your understanding of the foreign exchange transaction and
the Confirmation, it is important that you immediately raise
this with your Account Executive as a matter of urgency.
Telephone Recordings
Conversations with our Account Executives are recorded
in accordance with standard market practice. We do this to
ensure that we have complete records of the details of all
transactions. Taped conversations are retained for a limited
time and are usually used when there is a dispute and for
staff monitoring purposes. If you do not wish to be recorded
January 2014
you should inform your Account Executive at AFEX.
AFEX, however, will not enter into any transaction over the
telephone unless the conversation is recorded.
Complaints
At AFEX, we do everything we can to ensure that our
customers and clients are provided with the highest quality
of services. However, we also recognize that this may not
always be the case. When these issues arise, we always
encourage you to let us know so that we can address it
accordingly.
If you are not satisfied with any aspect of our services, you
can tell us about your concerns or make a complaint by
contacting your Account Executive at AFEX, or contact us at
the following address:
Associated Foreign Exchange, Inc.
Compliance Department
21045 Califa Street
Woodland Hills, CA 91367
You may also send us an email to: [email protected].
Our aim is to resolve your complaint as soon as possible.
If the final decision made to your particular complaint is
not satisfactory, you may refer your complaint to the below
applicable State Regulatory Agency. Details of our internal
complaints handling procedures are available on request.
•Alabama
Alabama Securities Commission
401 Adams Avenue, Suite 280
Montgomery, AL 36104
Website: www.bank.state.al.us
Telephone Number: (800) 392-5658
•Alaska
Department of Commerce, Community and Economic
Development; Division of Banking and Securities; Money
Service Businesses; 550 W. 7th Avenue, Suite 1940;
Anchorage, AK 99501
Telephone: (907) 269-4594
Fax: (907) 269-1066
E-mail: [email protected].
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Product Disclosure Statement - United States & Canada
•Arizona
Arizona Office of Financial Institutions
2910 North 44th St., Suite 310
Phoenix, AZ 85018
Website: www.azdfi.gov
Telephone Number: (800) 352-8431
•Arkansas
Arkansas Securities Department
201 E. Markham, Suite 300
Little Rock, AR 72201-1692
Website: www.securities.arkansas.gov
Telephone Number: (800) 482-8982
•California
If you have any complaints with respect to any aspect
of the money transmission activities conducted through
AFEX, you may contact the California Department of
Business Oversight at its toll-free telephone numbers,
(800) 662-0620, by e-mail at consumer.complaints@
dbo.ca.gov or by mail at Department of Business
Oversight, Consumer Services, 1515 K Street, Suite 200,
Sacramento, CA 95814
California Department of Business Oversight
45 Fremont Street, Suite 1700
San Francisco, CA 94105-2219
Website: www.dfi.ca.gov
Telephone Number: 1-800-952-5210
RIGHT TO REFUND: “You, the customer, are entitled
to a refund of the money to be transmitted as the result
of this agreement if Associated Foreign Exchange, Inc.
“AFEX” does not forward the money received from you
within 10 days of the date of its receipt, or does not give
instructions committing an equivalent amount of money to
the person designated by you within 10 days of the date
of the receipt of the funds from you unless otherwise
instructed by you.
If your instructions as to when the moneys shall be
forwarded or transmitted are not complied with and the
money has not yet been forwarded or transmitted you
have a right to a refund of your money.
January 2014
If you want a refund, you must mail or deliver your written
request to Associated Foreign Exchange, Inc. at 21045
Califa Street, Woodland Hills, California 91367. If you
do not receive your refund, you may be entitled to your
money back plus a penalty of up to $1,000 and attorney’s
fees pursuant to Section 2102 of the California Financial
Code.”
•Colorado
Entities other than FDIC insured financial institutions
that conduct money transmission activities in Colorado,
including the sale of money orders, transfer of funds, and
other instruments for the payment of money or credit
are required to be licensed by the Colorado Division of
Banking pursuant to the Money Transmitters Act, Title
12, Article 52, Colorado Revised Statutes. If there are
questions or concerns regarding a transaction with a
licensee, please contact the Colorado Division of Banking
at (303) 894-7575 or by mail at: Colorado Division of
Banking, 1560 Broadway, Suite 975, Denver, CO 80202.
Consumer complaints should be in writing, providing as
much detail as possible. Please include the following
information:
- The name of the institution and the name of any
person(s) at the institution with whom the complainant
has had contact. Include telephone number(s) and
addresses.
- A complete description of the complaint and any
efforts that have been made to resolve the complaint
directly with the institution.
- Copies of any available documentation supporting the
complaint and efforts toward resolution.
- Any suggestions regarding a preferred resolution of
the complaint.
•Connecticut
Connecticut Department of Banking
260 Constitution Plaza
Hartford, CT 06103-1800
Website: www.state.ct.us/dob
Telephone Number: (860) 713-6100
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Product Disclosure Statement - United States & Canada
•Delaware
Delaware Office of State Bank Commissioner
555 East Loockerman St., Suite 210
Dover, DE 19901
Website: www.banking.delaware.gov
Telephone Number: (800) 220-5424
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District of Columbia
Department of Banking & Financial Institutions
810 1st Street, NE Suite 701
Washington, DC 20002
Website: www.disb.dc.gov
Telephone Number: (202) 442-9828
•Florida
Associated Foreign Exchange, Inc. (“AFEX”) is a licensed
money transmitter under Chapter 560, Florida Statutes.
For suspected violations of Chapter 560, Florida
Statutes, call Associated Foreign Exchange, Inc. at (888)
428-2339 or contact the Florida Office of Financial
Regulation, 200 East Gaines Street, Tallahassee, FL
32399-0376, (800) 848-3792.
•Georgia
Georgia Department of Banking and Finance
2990 Brandywine Road, Suite 200
Atlanta, GA 30341
Website: http://dbf.georgia.gov
Telephone Number: (404) 651-8600
•Hawaii
Hawaii Division of Financial Institutions
335 Merchant Street, Rm. 221
Honolulu, HI 96813
Website: www.hawaii.gov/dcca/dfi
Telephone Number: (808) 586-2630
•Idaho
Idaho Department of Finance
800 Park Blvd., Suite 200
Boise, ID 83712
January 2014
•Illinois
Illinois Department of Financial and Professional
Regulation
Division of Financial Institutions
320 W. Washington
Springfield, IL 62786
Website: www.idfpr.com
Telephone Number: (800) 243-0618
Services are provided by Associated Foreign Exchange,
Inc. dba Associated Foreign Exchange of Illinois, Inc.
(“AFEX”), located at 21045 Califa Street, Woodland Hills,
California 91367, at (888) 428-2339. Upon receiving
good funds from you, our client, Associated Foreign
Exchange of Illinois, Inc. will make payment available
to you or your beneficiary, as indicated on the trade
confirmation, and commit to forwarding equivalent funds
according to given instructions within a period not to
exceed ten (10) business days. If your instructions as to
when the monies shall be forwarded or transmitted are
not complied with, you will have a right to a refund of the
money, subject to applicable exchange rates at the time
of the refund request. To request a refund in such cases,
please call or write AFEX at the number or address listed
above.
•Indiana
Indiana Department of Financial Institutions
Non-Depository Division
30 S. Meridian Street, Suite 300
Indianapolis, IN 46204
Website: www.in.gov/dfi
Telephone Number: (800) 382-5516
•Iowa
Iowa Division of Banking
200 E. Grand Ave., Suite 300
Des Moines, IA 50309-1819
Website: www.idob.state.ia.us
Telephone Number: (888) 777-4590
Website: www.finance.idaho.gov
Telephone Number: (800) 432-3545
Page 10 of 20
Product Disclosure Statement - United States & Canada
•Kansas
Kansas Office of the State Bank Commissioner
Division of Banking
00 SW Jackson, Suite 300
Jay Hawk Tower
Topeka, KS 66603-3714
Website: www.osbckansas.org
Telephone Number: (800) 432-2310
January 2014
•Massachusetts
Massachusetts Office of Commissioner of Banks
Division of Banks
1000 Washington Street, 10th Floor
Boston, MA 02110
Website: www.mass.gov/dob
Telephone Number: (617) 727-8400
•Kentucky
Kentucky Office of Financial Institutions
1025 Capital Center Dr., Suite 200
Frankfort, KY 40601
•Michigan
Michigan Department Labor & Economic Growth
Office of Financial & Insurance Services
611 W. Ottawa Street, Floor 3
Lansing, MI 48933
Website: www.kfi.ky.gov
Telephone Number: (888) 432-9257
Website: www.michigan.gov/dleg
Telephone Number: (517) 373-1140
•Louisiana
Louisiana Office of Financial Institutions
Depository Division
8660 United Plaza Blvd., 2nd Floor
Baton Rouge, LA 70809-7024
•Minnesota
Minnesota Department of Commerce
85 7th Place East, Suite 500
St. Paul, MN 55101
Website: www.ofi.louisiana.gov
Telephone Number: (800) 351-4889
•Maine
Maine Department of Professional
and Financial Regulation
Office of Consumer Credit Regulation
35 State House Station
Augusta, ME 04333
Website: www.maine.gov
Telephone Number: (800) 436-2131
•Maryland
The Commissioner of Financial Regulation for the State
of Maryland will accept all questions and complaints
from Maryland residents regarding Associated Foreign
Exchange, Inc., at: 500 N Calvert Street, Suite 402,
Baltimore, Maryland, 21202, phone toll-free: (888) 7840136.
Website: www.mn.gov/commerce
Telephone Number: (800) 657-3787
•Mississippi
Mississippi Department of Banking & Consumer Finance
Consumer Finance Division
501 N. West St.
901 Woolfolk Bldg., Suite A
Jackson, MS 39225-3729
Website: www.dbcf.state.ms.us
Telephone Number: (800) 281-4418
•Missouri
Missouri Division of Finance
301 W. High Street, Suite 630
Jefferson City, MO 65102-0716
Website: www.missouri-finance.org
Telephone Number: (800) 392-8222
•Nebraska
Nebraska Department of Banking & Finance
1230 O Street, Suite 400
Lincoln, NE 68509-5006
Website: www.ndbf.ne.gov
Telephone Number: (800) 727-6432
Page 11 of 20
Product Disclosure Statement - United States & Canada
•Nevada
Nevada Department of Business & Industry
Financial Institutions Division
1179 Fairview Drive, Suite 201
Carson City, NV 89701
•
Website: www.fid.state.nv.us
Telephone Number: (702) 486-3132
Website: www.nccob.gov/public
Telephone Number: (877) 560-7226
•
•
New Hampshire Customers:
New Hampshire Banking Department
53 Regional Drive, Suite 200
Concord, New Hampshire
Website: www.nh.gov/banking
Telephone Number: (888) 468-4454
•
New Jersey
New Jersey Department of Banking & Insurance
Division of Banking
20 W. State Street, 5th Floor
Trenton, NJ 08625-0040
Website: www.state.nj.us
Telephone Number: (973) 504-6200
•
New Mexico
New Mexico Regulation & Licensing Department
Financial Institutions Division
2550 Cerrillos Road
Santa Fe, NM 87504
Website: www.rld.state.nm.us
Telephone Number: (800) 678-1508
• New York
Additional terms for REMITTERS in New York.
Associated Foreign Exchange, Inc. (“AFEX”) is a
transmitter of money abroad. It is licensed and regulated
by the New York State Department of Financial Services.
Any unresolved complaints may be mailed to the New
York State Department of Financial Services, Consumer
Assistance Unit, One State Street, New York, NY 100041417.
New York Department of Financial Services
One State St.
New York, NY 10004-1417.
Website: www.dfs.ny.gov
Telephone Number: (800) 771-7755
January 2014
North Carolina
North Carolina Commissioner of Banks
Consumer Industries
316 W. Edenton St.
Raleigh, NC 27603
North Dakota
North Dakota Department of Financial Institutions
2000 Schafer Street, Suite G
Bismarck, ND 58501
Website: www.nd.gov/dfi
Telephone Number: (800) 472-2600
•Ohio
Ohio Department of Commerce
77 South High St., 21st Floor
Columbus, OH 43213
Website: www.com.ohio.gov
Telephone Number: (800) 282-0515
•Oklahoma
Oklahoma Office of the State Banking Department
2900 N. Lincoln Blvd
Oklahoma City, OK 73105
Website: www.osbd.state.ok.us
Telephone Number: (405) 521-3921
•Oregon
Oregon Department of Consumer & Business Services
Division of Finance & Corporate Securities
350 Winter St. NE, Room 410
Salem, OR 97301
Website: www.cbs.state.or.us/external/dfcs
Telephone Number: (877) 877-9392
•Pennsylvania
Pennsylvania Department of Banking
Department of Banking
17 N. Second St., 13th Floor
Harrisburg, PA 17101
Website: www.banking.state.pa.us
Telephone Number: (800) 441-2555
Page 12 of 20
Product Disclosure Statement - United States & Canada
• Puerto Rico
Puerto Rico Office of Commissioner
of Financial Institutions
Centro Europa Building, Suite 600
1492 Ponce de Leon Avenue
San Juan, Puerto Rico 00907
Website: www.ocif.gobierno.pr/index_eng.html
Telephone Number: (800) 981-7711
•
Rhode Island
Rhode Island Department of Business Regulation
1511 Pontiac Avenue
Cranston, RI 02920
Website: www.dbr.state.ri.us
Telephone Number: (401) 274-4400
•
South Dakota
South Dakota Division of Banking & Finance
Division of Banking
217 ½ W. Missouri
Pierre, SD 57501-4590
Website: www.dlr.sd.gov/banking/default.aspx
Telephone Number: (800) 300-1986
•Tennessee
Tennessee Department of Financial Institutions
414 Union Street, Suite 1000
Nashville, TN 37219
Website: www.state.tn.us/tdfi
Telephone Number: (800) 342-8385
•Texas
Contact information for complaints:
Associated Foreign Exchange, Inc. dba AFEX is licensed
under the laws of the State of Texas, and by state law is
subject to regulatory oversight by the Texas Department
of Banking. Any consumer wishing to file a complaint
against Associated Foreign Exchange, Inc. dba AFEX
should contact the Texas Department of Banking.
If you have a complaint, contact AFEX at complaints.
[email protected]. If you still have an unresolved compliant
regarding the company’s money transmission activities,
please direct your compliant to Texas Department of
Banking, located at 2601 North Lamar Boulevard,
Austin, Texas 78705, 1-877-276-5554 (toll free),
www.dob.texas.gov
January 2014
•Utah
Utah Department of Financial Institutions
324 South State St., Suite 201
Salt Lake City, UT 84111-0089
Website: www.dfi.utah.gov
Telephone Number: (801) 530-6601
•Vermont
Vermont Department of Banking, Insurance, Securities &
Health Care Administration
89 Main Street, Drawer 20
Montpelier, VT 05620
Website: www.bishca.state.vt.us
Telephone Number: (800) 649-2424
•Virginia
Virginia State Corporation Commission
Bureau of Financial Institutions
1300 E. Main St., Suite 800
Richmond, VA 23218
Website: www.scc.virginia.gov
Telephone Number: (800) 552-9963
•Washington
Entities other than FDIC insured financial institutions
that conduct money transmission activities in Washington
State, including the sale of payment of money or credit
are required to be licensed. If there are questions or
concerns regarding a transaction with a licensee please
contact the Washington State Department of Financial
Institutions at (360) 902-8703 or by mail at: Department
of Consumer Services, 150 Israel Road Southwest,
Olympia, WA 98504-1200.
To file a complaint, please provide: the name of the
company, office location, and who you contacted at the
company; your name, mailing address, and ten digit phone
numbers; and a simple explanation of the problem, with
a list of events in chronological order, making sure to
include names and dates. Be specific and as brief as
possible. For electronic submission, please complete
the form found on the website: www.dfi.wa.gov, under
Consumer Information: File a Complaint.
Washington Department of Financial Institutions
150 Israel Road SW
Tumwater, WA 98501
Website: www.dfi.wa.gov
Telephone Number: (206) 464-6684
Page 13 of 20
Product Disclosure Statement - United States & Canada
•
West Virginia
West Virginia Division of Banking
One Players Club Drive
Suite 300
Charleston, WV 25326-1789
Website: www.wvdob.org
Telephone Number: (800) 368-8808
•Wisconsin
Wisconsin Department of Financial Institutions
Division of Banking
– Licensed Financial Services Section
345 W. Washington Ave., 4th Floor
Madison, WI 53703
Website: www.wdfi.org
Telephone Number: (800) 998-0700
•Wyoming
Wyoming Department of Audit
Division of Banking
122 West 25th Street
Cheyenne, WY 82002
Website: audit.state.wy.us/banking
Telephone Number: (800) 438-5799
Privacy Statement
This Privacy Statement describes how AFEX collects
both, personal and non-personal information; how it
uses and shares this information. This Statement also
explains what choices you have in managing your privacy.
Financial companies choose how they share your personal
information. Federal law gives consumers the right to limit
some but not all sharing. Federal law also requires us to
tell you how we collect, share, and protect your personal
information.
How do we collect information?
AFEX collects non-public Personal Information about you
from the following sources:
• Information we receive from you on applications or other
forms;
• Information about your transactions with us, our affiliates,
or others; and
• Information we receive from a consumer reporting
agency.
January 2014
The type of non-public Personal Information we collect can
include your:
• Social security number (SSN or Taxpayer Identification
Number); and
• Credit history and credit scores.
How do we use information?
We use the Personal Information collected as described in
this Statement in the following ways:
• To deliver products and services (e.g.; process
applications, complete transactions, etc.);
• To advertise and market our products and services;
• To conduct research and analysis (e.g.; analyze data to
prevent fraud, etc.)
• As otherwise required or permitted by law or with your
consent.
How do we share information?
In keeping with AFEX policy, we do not share non-public
information with anyone, except as described below.
We may share Personal Information as required or permitted
by law:
• To report or seek information about your credit, and to
report or collect on debts owed;
• To comply with legal orders and government requests;
• To combat fraud or criminal activity, and to protect the
rights of AFEX or others; and/or
• With Vendors (who are required to safeguard Personal
Information) that help us operate our business.
When you close your account, we continue to share
information about you as permitted by law.
What are your choices?
You may tell us to stop sending you marketing information.
We will still communicate with you in connection
with servicing your account, fulfilling your request, or
administering any promotion or any program in which you
may have elected to participate. Materials we send you may
still include some offers or promotions. It may take some
time for us to process your request and, consistent with
applicable law, could take up to 30 days. If you have more
than one account with us, you must tell us your choices
separately for each account.
Page 14 of 20
Product Disclosure Statement - United States & Canada
Disclosure of and Control over Personal Information
We will only disclose personal information to other AFEX
group companies or third parties for everyday business
purposes, such as to process your transactions, maintain
your account(s), perform information technology functions,
respond to court orders and legal investigations, report to
credit bureaus, or to offer our products and services to you.
Please note that these disclosures are not subject to an
opt-out choice, as such disclosures are necessary to run our
everyday business.
Confidentially and Security of Personal Information
AFEX restricts access to non-public personal information
about you to those employees who need to know that
information to provide products or services to you. We
maintain physical, electronic, and procedural safeguards
that comply with federal standards to guard your non-public
personal information.
If, at any time, you have questions, concerns or comments
about our Privacy Policy, please feel free to contact AFEX at
21045 Califa Street, Woodland Hills, CA 91367, or via email
at: [email protected].
Fraud Protection
Identify Theft
Identity theft occurs when someone uses your name or
personal information, such as your Social Security number,
driver’s license number, credit card number, telephone
number or other account numbers, without your permission.
Identity thieves use this information to open credit accounts,
bank accounts, telephone service accounts, and make major
purchases—all in your name.
How Does Identity Theft Happen?
Identity theft commonly begins with the loss or theft of a
wallet or purse. But there are many other ways that criminals
can get and use your personal information in order to
commit identity theft. The following are some examples:
• Phishing (pronounced “fishing”) refers to fraudulent
communication designed to deceive consumers into
divulging personal, financial or account information.
Phishing e-mails continue to be prevalent for individuals
and companies. Spoofing well-known companies,
January 2014
these e-mails ask consumers to reply, or “click” a link
to a fraudulent web page that will ask for personal
information, such as their credit card number, Social
Security number or account password. These fraudulent
e-mails are often difficult to identify but there are some
techniques you can use to protect yourself. Below are
some examples:
E-mail Greetings
Always be suspicious of e-mails that do not greet you by
name. While not impossible, it is more difficult and costly
for phishers to associate an e-mail address with the
e-mail owners name on a mass scale. Because of this,
phishing e-mails most often are addressed generically
like “Dear Customer” or “Dear Account Holder.”
When you receive an e-mail from AFEX related to your
account, the email will include your account number. If
you receive an e-mail regarding your AFEX Account but it
does not contain this information, it may be fraudulent. If
you are concerned about the legitimacy of an e-mail from
AFEX you can forward the e-mail to [email protected].
If the e-mail is fraudulent we will take the appropriate
actions.
Sense of Urgency
Phishing e-mails often try to create a false sense of
urgency intended to provoke the recipient to take
immediate action; for example, phishing e-mails
frequently instruct recipients to “validate” or “update”
account information or face cancellation. Be very cautious
of any e-mail asking you to update sensitive information
particularly if it has a generic greeting (see above).
Links in E-mails
Nearly every commercial e-mail today contains a “link to
a website,” or website address (URL). Links are used by
business as a convenience for their customers to help
them easily find information the customer is looking for.
Unfortunately, phisher’s also use links to drive customers
to “fake” or “spoofed” websites. Look for the warning
signs outlined above (generic greetings, sense of
urgency). If you are suspicious of the e-mail, do not click
on any links contained in it. Instead, go to the website
by using your “favorites” if you have it saved, or type the
website’s URL directly into your browser.
Page 15 of 20
Product Disclosure Statement - United States & Canada
What Should You Do If You Suspect an E-mail Is a
Phishing Attempt
If you are suspicious of an e-mail you receive, you should
forward the e-mail to the legitimate company being
impersonated. Today, most financial institutions have an
e-mail address where you can forward the suspicious
e-mail.
If you receive an e-mail claiming to be from AFEX that
you believe to be suspicious, please forward the e-mail
to [email protected]. We will review the e-mail and, if it is
fraudulent, we will take appropriate action.
• Phone Phishing (also called “Vishing”) is another way
fraudsters try to collect sensitive information from you. In
this type of fraud, the fraudster will either contact you by
telephone or send you a fake e-mail and ask for you to
respond by telephone.
What Should You Do If You Supplied Sensitive Information
over the Phone to a Suspicious Party?
If you have already responded to a suspicious caller with
your AFEX account information and you believe it to be
fraudulent, please contact AFEX immediately by calling
your Account Executive.
• Dumpster Diving occurs when criminals physically
go through your trash receptacle in an effort to find
information you discarded.
Account Protection Services
AFEX goes to great lengths to protect your Account from
fraudulent use. Below are some examples of the ways we
protect your Account from fraudulent use.
Automated Trade Confirmations
After conducting a transaction with AFEX, the Account’s
Primary Contact or Designated Email Address will receive
a Trade Confirmation disclosing the trade order, including
the transaction amount, rate exchange applied, and delivery
instructions, if applicable.
January 2014
Irregular Account Activity Alert
If we detect a questionable transaction on your account,
we will contact you to verify its legitimacy and may request
supporting documentation.
Compliance
As a Global Payment and Risk Management Solutions
institution, AFEX is committed to full compliance with all
applicable laws and regulations regarding Anti-Money
Laundering (AML). AFEX’s policy is to prevent people
engaged in money laundering, fraud, and other financial
crimes, including terrorist financing, from using AFEX’s
products and services.
AFEX has robust policies and procedures to detect,
prevent and report suspicious activity. To comply with
OFAC (Office of Foreign Asset Control) requirements,
and global sanctions, we screen our customer accounts
against government watch lists. In addition, we may request
that you provide us with documentation to help prove your
identity or for business verification purposes. We report
suspicious transactions to the financial intelligence unit in
the respective country.
How does this impact me?
As part of our AML procedures, we collect information from
you to satisfy our Know Your Customer requirements. This
means that we may request information from you due to
a specific identification requirement or as a result of our
watch list screening process. We may ask you to provide
documentation to help confirm your identity or provide
additional information regarding your business. We may
also request that you seek pre-approval for utilizing AFEX’s
services if your account falls within a high risk compliance
category.
In addition, you are independently responsible for complying
with all applicable laws in all of your actions related to your
use of AFEX’s services, regardless of the purpose of
the use.
Monitoring Your Account for Suspicious Transactions
AFEX has sophisticated monitoring systems and controls
in place to detect fraudulent activity and protect our Client’
accounts from misuse.
Page 16 of 20
Product Disclosure Statement - United States & Canada
Prohibited Activities
You may not use the any of our products and services for
activities that:
1. Violate any law, statute, ordinance or regulation.
2. Relate to transactions involving (a) narcotics, steroids,
certain controlled substances or other products that
present a risk to consumer safety, (b) drug paraphernalia,
(c) items that encourage, promote, facilitate or instruct
others to engage in illegal activity, (d) stolen goods
including digital and virtual goods (e) items that promote
hate, violence, racial intolerance, or the financial
exploitation of a crime, (f) items that are considered
obscene, (g) items that infringe or violate any copyright,
trademark, right of publicity or privacy or any other
proprietary right under the laws of any jurisdiction,
(h) certain sexually oriented materials or services,
(i) ammunition, firearms, or certain firearm parts or
accessories, or (j) ,certain weapons or knives regulated
under applicable law.
3. relate to transactions that (a) show the personal
information of third parties in violation of applicable law,
(b) support pyramid or ponzi schemes, matrix programs,
other “get rich quick” schemes or certain multi-level
marketing programs, (c) are associated with purchases of
annuities or lottery contracts, lay-away systems, off-shore
banking or transactions to finance or refinance debts
funded by a credit card, (d) are for the sale of certain
items before the seller has control or possession of the
item, (e) are by payment processors to collect payments
on behalf of merchants, (f), are associated with the sale
of traveler’s checks or money orders, (h) involve currency
exchanges or check cashing businesses, or (i) involve
certain credit repair, debt settlement services, credit
transactions or insurance activities.
4. Involve the sales of products or services identified by
government agencies to have a high likelihood of being
fraudulent.
5. Violate applicable laws or industry regulations regarding
the sale of (a) tobacco products, or (b) prescription drugs
and devices.
6. Involve gambling, gaming and/or any other activity with an
entry fee and a prize, including, but not limited to casino
games, sports betting, horse or greyhound racing, lottery
tickets, other ventures that facilitate gambling, games
of skill (whether or not it is legally defined as a lottery)
and sweepstakes unless the operator has obtained prior
approval from PayPal and the operator and customers are
located exclusively in jurisdictions where such activities
are permitted by law.
January 2014
Taxation
Taxation laws in either the United States or Canada are
complex and their application will depend on the customer
or client’s specific circumstances. When determining
whether or not these products are suitable you should
consider the impact it will have on your own taxation position
and seek professional advice on the tax implications it may
have for you.
Page 17 of 20
Product Disclosure Statement - United States & Canada
January 2014
Contact Us
Los Angeles
21045 Califa Street
Woodland Hills, CA 91367
T +1 (888) 307-2339
F +1 (424) 588-5024
Beverly Hills
327 N Beverly Drive,
Beverly Hills, CA 90210
T +1 (800) 346-2339
F +1 (310) 274-6167
New York
805 Third Avenue
Suite 1210
New York, NY 10022
T +1 (888) 428-2339
F +1 (646) 231-7898
Chicago
1 North Wacker Drive
Suite 2355
Chicago, IL 60606
T +1 (312) 920-6800
F +1 (312) 920-6898
Miami
1001 Brickell Bay Drive
Suite 2700
Miami, FL33131
T +1 (866) 525-3622
F +1 (866) 525-4127
Page 18 of 20
Product Disclosure Statement - United States & Canada
January 2014
Glossary
AFEX
Indicative Rate
Associated Foreign Exchange, Inc., a licensed and regulated
as a Money Transmitter by several State and Federal
Regulatory Agencies.
An unconfirmed directorial rate that can be used as a guide.
Usually quoted outside of normal business hours or when it
is not possible to quote a current market rate.
Beneficiary
Intermediary Bank
The recipient of funds that are being transferred. A
beneficiary bank is where the bank account of the
beneficiary is held.
A bank nominated to receive payments on behalf of those
banks that cannot have payments sent directly to them
(because they are not supported in the SWIFT network
or because the currency being sent is not the beneficiary
bank’s local currency). E.g. A U.S. dollar payment sent to a
beneficiary bank in India would be routed via an intermediary
bank in the United States that has a relationship with the
beneficiary bank.
BIC/ Bank Identifier Code
A code used to identify an individual branch of a bank by
using the SWIFT network.
Direct Debit
Permission to allow AFEX to debit funds automatically from
a selected bank account, to cover any payment instructions
created.
Intraday Spot
Where a rate and an amount are locked in. It can be used to
draw down several payments or just one total amount.
Draft
Local Currency
An international check issued by AFEX.
A country’s domestic currency. E.g. United States Dollar or
Canadian Dollar.
Forward Contract/ Foreign Currency Forward
A foreign exchange instrument that allows you to lock in
a favorable exchange rate by purchasing a set amount of
a foreign currency at a fixed price for a future payment
obligation.
Maturity Date
The date for settlement or expiration of a Forward Contract.
Payee
See Beneficiary.
Forward Drawdown
A wire transfer created using an existing Forward Contract.
Payment Reference
IBAN/ International Bank Account Number
A unique 16 digit FX International Payments reference
number applied to every payment.
An International Bank Account Number contains an
organization’s account number, preceded by the specific
country codes and branch number. They are typically used
for Euro payments to avoid any extra beneficiary bank
charges being applied by the receiving bank.
Incoming Wires/Drafts
The receipt of foreign currency payments — either
electronically or as a draft.
Payment Scheduling
Similar to a standing order, payment scheduling allows FX
IP clients to plan payments with funds automatically being
sent as per their chosen schedule in the future – the client
can choose selects the frequency of Payments, can select
whether to continue the payments until further notice
(ongoing) or can select an expiry date (future dated) or may
enter a number of installments to be paid.
Page 19 of 20
Product Disclosure Statement - United States & Canada
January 2014
Quote
Spot/Spot Value
A Quote will give you the cost to exchange a certain amount
in a given currency.
Routing Number
A term describing a foreign exchange transaction in which
the settlement date follows within two working days of the
trade date. Drafts and wire transfers are typically “sold at
spot.”
A code used to identify an individual branch of a bank
utilizing the local market clearing system.
Spot Payment
Settlement Date
Spot Payment leaves the rate floating until a client with
single verification accepts it or a client with dual verification
approves it.
A term used to describe the date on which a trade will be
delivered. Also known as the Value
Transaction Date
Date
The date on which a transaction is initiated/agreed.
For spot transactions, this is typically two working days after
the transaction date.
Value Date
See Settlement Date.
Settlement Method
The method of payment used to fund a wire transfer, draft or
forward contract.
Same Day Value
A method of buying or selling foreign currency in which
the value date is the same day as the trade date. Products
commonly “sold at same day value” are wire transfers.
However, this can only be achieved in certain currencies due
to the time zones of banking systems.
Window
Specifies a future date range during which payments can be
made until the total contract amount is settled. This is known
as “Drawing Down”.
Wire Transfer
An electronic payment order transferring funds from one
bank to another.
Page 20 of 20