The Dubai Financial Services Authority (DFSA) has published the findings of its Thematic Review on Crowdfunding Platform Operators (Operators) within the Dubai International Financial Centre (DIFC). The Review focused on Client Agreements and adherence to the DFSA Conduct of Business (COB) disclosure requirements to ensure Retail Clients have a clear understanding of investments made via Operators.
The Review highlights the importance of transparency and clarity in agreements and disclosures provided to investors. It assessed the following areas:
- Client Agreements: Examined issues such as Operators disclaiming liability for information provided on the platform, lack of Absence of Client Agreements between Operators and Sellers in Property Crowdfunding, and gaps in information required by COB A2.1.2.
- Disclosure Requirements: Addressed missing or incomplete information about services offered as well as borrowers in the case of Loan Crowdfunding. Discussed absence of effective second- and third-line controls for review of disclosures and agreements
The DFSA encourages all Crowdfunding Platforms to consider these findings and, where needed, improve their agreements, disclosures, and internal processes. Platforms are also reminded to keep the DFSA informed of any significant changes or events.
For further information, access the full Thematic Review here:
https://www.dfsa.ae/download_file/3739/0
