CySEC reaches €280,000 settlement with parent company of 24option
The settlement concerns Rodeler’s possible violations of the Cypriot investment services laws.
Shortly after it became clear that Rodeler Ltd (trading as 24option) intends to renounce its Cyprus Investment Firm authorization, the Cyprus Securities and Exchange Commission (CySEC) has confirmed that a settlement has been reached with the firm regarding violations of Cyprus laws.
The settlement is concluded as a part of the examination for voluntary renunciation of the authorisation, and concerns possible violations of the Investment Services and Activities and Regulated Markets Law of 2017 – L.87(I)/2017 («the Law»). More specifically, the investigation for which the settlement was reached, involved assessing, for the period January 2018 until December 2019, Rodeler’s compliance with:
- Article 5(1) of the Law, regarding the requirement for CIF authorisation.
- Articles 25(1) and 25(3) of the Law, regarding general principles and information to clients.
- Article 22(1) of the Law as to the authorisation condition laid down in article 17(6) of the Law, regarding the organisational requirements with which a CIF is required to comply.
The settlement is for the sum of €280,000.
As FinanceFeeds reported in June, the UK Financial Conduct Authority (FCA) barred a number of Cypriot brokerages, including Rodeler Ltd from offering CFD trading services in the UK. The regulator said that these firms used unauthorised celebrity endorsements on social media as part of their marketing. The firms used social media and webpages carrying fake endorsements from celebrities to entice consumers into the scams involving CFDs.
The FCA estimates that UK investors have lost hundreds of thousands of pounds in these investments. A number of customers are known to have lost more than £100,000 to the schemes.
The orders require the companies to stop selling CFDs to UK customers, to close existing positions with UK customers, to return UK customers’ money and to notify UK customers of the FCA’s action.