Conflicts of interest occur where the interest of the Firm (or another company with which the Firm is associated), and/or the interests of the Firm’s staff, are in conflict with the interests of one or more customers. A conflict of interest can also arise between the Firm and its employees.

There are various instances where a conflict of interest may occur. Conflicts could be between various persons, such as:

• The Firm and the customer;

• One customer and another customer;

• An employee of the Firm and a customer;

• An employee and the Firm.

Below are some examples of situations that may cause conflicts of interest to materialise, where the Firm:

• would make a financial gain, or avoid a financial loss, at the expense of a customer;

• has an interest in the outcome of a service provided to the customer or of a transaction carried out on behalf of the customer, which is distinct from the customer’s interest in that outcome;

• holds knowledge in confidence for one customer which would benefit another;

• acts as agent for two customers to execute a transaction between them;

• has a financial or other incentive to favour the interest of another customer or group of customers over the interests of the customer;

• may be remunerated in a way which encourages it to act against its customers’ interests; and

• receives or will receive from a person other than the customer an inducement in relation to a service provided to the customer, in the form of monies, goods or services, other than the standard commission or fee for that service.

As per applicable regulations, we take all appropriate and reasonable steps to prevent or mitigate conflicts of interest. In order to achieve this, the Firm maintains and operates effective organisational and administrative arrangements with a view to taking all reasonable and appropriate steps to prevent and manage conflicts of interest in order to prevent them from adversely affecting the interests of our customers.

If the Firm’s arrangements to manage a potential conflict of interest are not sufficient to ensure with reasonable confidence that the risk of damage to a customer’s interests is prevented, the Firm will disclose the conflict to the customer. The Firm may decline to act in situations where conflicts of interest are unavoidable.

Based on its business model the Firm has identified the following potential conflicts:

• Employee Roles and Responsibilities
• Order Handling and Best Execution
• Instruments Offered
• Client cash and interest retention
• Gifts and Hospitality
• Intra Group

The Firm implements segregation of roles and responsibilities between activities which could create a conflict of interest, with defined reporting lines and escalation routes. This includes segregation of director responsibilities and quorum requirements to prevent the risk of a director prioritising the interest of one group entity over that of another or its customers.

All employees are provided with conflicts of interest training and expected to raise potential or actual conflicts which they become aware of so that this can be documented by the Firm and prevented or managed as appropriate.

The Firm executes your orders according to our Order Execution Policy.

The Firm may:

• execute any orders itself. As described in the Order Execution Policy the Firm may execute trades directly with a venue or act as agent to execute orders between our customers over the counter (OTC) orders, one of whom may be a group entity Broker. This approach is more likely for EU or UK instruments for which Lightyear supports fractionalisation. The Firm does not receive any additional monetary benefits from this beyond declared execution fees and will execute such orders as prevailing market prices so that the interests of one party do not take precedence over those of the other;
• transmit customer orders to Broker for execution (or onward transmission to third party broker for execution). Broker may execute orders on its own account, for example, fractions orders. Where this does happen, the order will be executed at prevailing market values to ensure customers are not disadvantaged. The Firm and Broker do not receive any benefit (monetary or otherwise) from any trade execution venues in return for sending the Firm’s customers’ orders to them;
• implement timeout and reject logic as well as inventory exposure caps protect the Firm's book which could be at the cost of customer order completion.

The Firm does not trade on a principal basis, which eliminates direct trading conflicts between the Firm and its customers.

Whole share market orders placed during market open hours will generally be sent for execution when the order is placed. As set out in the Order Execution Policy:

• The Firm may aggregate together some OTC Orders that are only executed at a certain time(s) during the day, such as Money Market Funds (MMFs), so that it is unlikely the aggregation of OTC orders and transactions will work overall to the disadvantage of any Customer whose orders is to be aggregated.
• Where the Firm or the Broker aggregate an order with one or more other Customer Orders and the aggregated Order is partially executed, the Firm shall allocate the related trades proportionately across all Customers.

The Firm performs dealing services as per its Terms of Service with customers in relation to instruments made available on the Lightyear App. Those services include arranging (bringing about) deals in investments and safeguarding of assets. One of the executing Brokers and sub-custodian the Firm has appointed to support this is a Lightyear group entity. The Firm does not receive any inducement or other incentive for transmitting orders to an intra group entity. The Firm has internally defined what instrument orders are sent to which counterparty which includes consideration of the price availability and likelihood of execution, monitored through ongoing best-execution monitoring.

The Firm provides services on an execution-only basis. This means that the services are non-advised and so the Firm will not provide the customer with any advice of any kind, nor provide a view as to whether a particular instrument is suitable for the customer.

The Firm does not receive commissions, rebates, or other monetary benefits from the issuers or manufacturers of instruments available on the Lightyear App.

The Firm may earn different amounts of revenue depending on how a customer holds their money. Currently this comprises a fee charged by the Firm on holdings in Money Market Funds, whether held directly or through a Vault, which is deducted from the fund's distribution before the remainder is paid to you. This means the Firm has a financial interest in how customers allocate money between instruments.

The Firm also decides which Money Market Funds are made available on the App. We manage this conflict of interest by:

• setting the fee at a fixed percentage rate;
• selecting funds and share classes on the basis of the net return to customers rather than the revenue to the Firm;
• not linking staff remuneration or marketing targets to balances held in any particular instrument;
• and reviewing the fee for fair value at least annually.

We show the Firm's fee, the fund manager's charges and the net return you will receive before you invest and on an ongoing basis.

The Firm has revenue arising from fees levied on Money Market Funds, whether invested in directly or via Vault, which are deducted from distribution payments. This is mitigated by prominently disclosing the net return customers will receive along with information about the breakdown of the Firm and fund manager’s fees which are deducted from the gross return.

The instruments that can be purchased or sold through the Lightyear App may change from time to time.

The Firm retains all interest on uninvested client money held in EUR or USD and part of the interest arising from uninvested client money held in GBP. This creates a conflict of interest as it may incentivise the Firm to allow large uninvested cash balances to accrue, contrary to customer best interests.

The interest paid to customers is disclosed in the App and on our website, and the Firm actively monitors and engages with customers holding large uninvested cash balances for prolonged periods.

The interest retention does enable the Firm to provide its services without account fees, platform fee or custody fees. The proportion of interest retained by the Firm is continually reviewed in light of the Firm’s fair value assessment and prevailing bank interest rates.

Staff at the Firm are unable to offer or accept gifts and hospitality that surpass a specified threshold without prior management approval and business justification. Cash or cash-like gifts are prohibited. All gifts and hospitality given or received by staff will be recorded by the Firm.

The Firm is part of the Lightyear group where services are provided between group entities.This is for operational efficiencies but may create conflicts if the priorities of one entity take precedence over another or the service provided does not meet the needs of the Firm or its customers. This is mitigated through contractual agreements, defined service level agreements and due diligence. The Firm maintains governance oversight to ensure that conflicts are identified and prevented or managed such that they do not give rise to customer detriment.

If you need to get in touch with the Firm about anything, you can email us at support@lightyear.com. We do not currently offer a dedicated phone helpline.