Prop index growth sparks legal fears

Frying pan to fire?

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Question: when is a debt security not a debt security? Answer: when it does not offer principal protection, contains early redemption clauses or is acting as a pass-through conduit for an underlying index.

That may have the rough form of a joke, but lawyers who work for big structured products houses in London are not laughing. Some fear the safe harbour provided by the UK’s collective investment scheme (CIS) regime – which gives banks broad freedom to sell derivative-based products to retail in

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