CySEC imposes fine of EUR50,000 on now-defunct broker LQD Markets
The company did not keep records of all client transactions for a period of five years as required by the law.
The negative developments around now-defunct retail Forex broker Liquid Markets continue. Earlier today, the Cyprus Securities and Exchange Commission (CySEC) said its Board of Directors had decided to impose a fine of EUR50,000 on LQD Markets Ltd.
The fine stems from law violations related to the failure of the firm to keep records of all transactions in financial instruments of its clients for a period of five years. In determining the size of the penalty, CySEC took into account the seriousness of the violations, as well as the fact that the lack of proper transactions deprives the regulator from access to important information and thus prevents it from exercising its functions. The mitigating factor was the fact that this was the first such violation committed by the broker, according to CySEC.
Whether CySEC will be able to collect anything from a defunct company is an open question.
Let’s recall that the broker, which provided investment services via the domain www.lqdmarkets.com, renounced its authorization as a Cyprus Investment Firm (CIF) in July 2014. However, LQD Markets Ltd has remained under the supervision of the Cyprus Securities and Exchange Commission until the settlement of its obligations arising from the investment services or/and activities that lapsed.
Meanwhile, the chaos around LQD Markets (UK) continues. The latest report by the special administrators was incomplete, just highlighting the mess that former clients of the broker are about to experience. On the brighter side, the Special Administrators have instructed lawyers to commence with the application to Court to request a bar date is set for clients to submit claims and to commence the distribution process. The draft order and supporting witness statement is being reviewed by the Special Administrators. They expect the application will be made within the next four weeks.