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What Is the Term for the Misappropriation of Client Funds by an Exchange?

'Commingling' (mixing client and company funds) or 'embezzlement' (fraudulent appropriation of funds).
Greeks.Live22.11.25

What Is the Term for the Misappropriation of Client Funds by an Exchange?

The term for the misappropriation of client funds is 'commingling' or 'embezzlement'. Commingling is the act of mixing client funds with the exchange's operational funds, which is a major regulatory violation.

Embezzlement is the fraudulent appropriation of those funds for personal or unauthorized use. Both represent a severe breach of trust and can lead to exchange insolvency.

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