IG Group performs U-turn: Company asks “why pay for something you don’t use” yet upholds inactive account charges

This morning, IG Group published an advert asking customers “Why pay for something you don’t use” relating to stop loss charges, however the company levied an account inactivity charge of £12 two years ago which remains in force – an inactive account being something “you don’t use”

london

Among Britain’s vast electronic trading giants, it appears that some are more equal than others.

IG Group, one of the largest electronic trading firms in the world with a market capitalization of £3.14 billion has a very distinct place in the market, and is a prominent firm among London’s long-established stalwarts.

The company’s marketing strategy today has taken an interesting course indeed.

Today, IG Group has posted on its Facebook feed a type of advertisement that infers that traders should consider what they are paying for.

“Why pay for something you don’t use?” says the advertisement. “Our unique guaranteed stop loss comes with no charge unless your stop is hit.”

Whilst this may appear attractive to retail traders, it is worth bearing in mind the account inactivity fees that IG Group began levying a couple of years ago, by which clients pay handsomely for something that they don’t use.

Capture
Source: Facebook

Advertising with regard to charges is most certainly a very significant method of attracting customers, however making a statement to this effect is worthy of further research as there may be other areas in which a firm charges for something that a customer may not use.

Here is an excerpt from IG Group’s notification of charging customers for inactivity:

use
Source: IG Group

“No comment” came the reply

FinanceFeeds contacted IG Group’s marketing department today in order to gain clarification on this matter, however the company responded by stating “no comment.”

The incisive method by which IG Group solicits its customers and ensures that it can maintain an edge over the very sophisticated and equally strong competition has come to light a few times recently, a good example being the restriction in trading that blighted $1 billion dollar firm Plus500 last year.

According to a number of sources at the time, Plus500 UK’s restriction was initiated by a series of competing companies having close relationships with FCA officials, and in some cases recruiting former FCA officials to work in departments dedicated to researching what could be deemed as malpractice by competitors in order that they can use their channels and connections to converse with officials in order to put a metaphorical spanner in their works.

The basis for the FCA’s instruction to Plus500 UK was that the regulator had concerns about the company’s checks when onboarding new clients, especially relating to Anti-Money Laundering (AML) procedures.

By mid-June 2015, following this action, Plus500’s valuation had declined to £459.6 million, almost half of the firm’s value just two weeks prior, rousing the interest of Teddy Sagi’s Playtech PLC (LON:PTEC) which entered into discussions with Plus500 with regard to acquisition, and thus today yet again the regulator has stepped in to halt proceedings.

This matter was quickly put to bed, and Plus500 once again is flourishing with its market capitalization back at high levels, resting at £854 million which is way past the $1 billion that it stood at prior to the regulatory freeze.

Photograph copyright FinanceFeeds

Read this next

Digital Assets

BlackRock digs further into crypto with metaverse ETF

BlackRock, the world’s largest asset manager with almost $10 trillion in AUM, is set to launch a new metaverse ETF to help investors securely monetize on the booming immersive version of the internet.

Digital Assets

Binance wins license in New Zealand as rival Huobi shutters derivatives

Binance, the world’s largest crypto exchange by traded volume, has obtained licenses to operate in New Zealand, even after rival Huobi shutdown derivatives trading last month due to concerns about regulations.

Retail FX

Hong Kong busts perpetrators of ‘ramp and dump’ scam

Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), has charged thirteen suspects of market manipulation in a joint operation with the local police.

Institutional FX

TradingView integrates market data from German Tradegate exchange

TradingView announced that it ‎has increased data coverage to allow its users to receive information from ‎and get free access to the intra-day and tick data from Tradegate Exchange.

Retail FX

Spotware Systems introduces Custom Push Notifications for cTrader mobile apps

Spotware Systems, a technology provider for the electronic trading industry, is introducing a new push notification feature to alert mobile users of price swings and market fluctuations through their cTrader app.

Market News

The Week Ahead: 30 September from David Madden, Market Analyst at Equiti Group

Sterling dominated the headlines last week, as there were concerns the UK government might struggle to service its debt.

Inside View

How does the quality of signal providers affect your business?

A must-have onboarding process for brokers with investment services like PAMM, MAM, or copy trading

Technology

DBS deploys Nasdaq Trade Surveillance

“The confidence that markets and our clients have in DBS as a safe and trusted banking group is anchored on our ability to detect and respond to anomalous activity, which in turn calls for a robust surveillance and prevention infrastructure.”

Industry News

SEC charges Justin Costello and David Ferraro for securities fraud and posing as billionaire veteran

The Securities and Exchange Commission charged Cannabis executive Justin Costello and David Ferraro, an associate of Costello’s, for promoting the stock of several microcap companies on social media without disclosing their own simultaneous stock sales as market prices rose.

<