CySEC slaps €100,000 fine on FX broker FXVC

abdelaziz Fathi

The Cyprus Securities and Exchange Commission ( CySEC ) announced that it has fined Finteractive Ltd (trading as FXVC) €100,000 due to shortcomings in the company’s regulatory obligations.

Finteractive Ltd (trading as FXVC)

Accurate details of the settlement haven’t yet been made public, however the violations are related to the general principals of conduct related to the Money Laundering and Terrorist Financing Law (L. 188(Ι)/2007).

“More specifically, the investigation for which the settlement was reached, covers the period 1.8.2019 to 28.2.2021 and involved assessing the Company’s compliance with article 22(1) of the Law as to the authorisation condition laid down in article 17(2) of the Law, regarding the organisational requirements with which a CIF is required to comply,” the statement reads.

In particular, FXVC was flagged for conducting business or facilitating some activities not stated in its authorisation. Cypriot CIFs need to notify CySEC when they are providing their services in ‎third countries. Before they can deliver their product in a given country, they ‎need to get appropriate authorisation from the country’s regulatory ‎authorities first.‎

FXVC was among a handful of Cypriot brokers that the UK’s FCA suspended their passporting rights. At the time, the British watchdog also barred the UK counterparts of Hoch Capital Ltd (trading as iTrader and tradeATF), Magnum FX (Cyprus) Ltd (trading as ET Finance), Rodeler Ltd (trading as 24option) and F1Markets Ltd (trading as Investous, StrattonMarkets and Europrime).

The City regulator said these firms failed to pay money owed to investors and charged customers undisclosed fees whilst failing to disclose the risks of trading CFDs. The Cysec has also suspended several forex brokers that were caught up in promoting their risky products in the UK.

The FCA said FXVC used a variety of inappropriate techniques, including misleading financial promotions which appeared to offer consumers the opportunity to purchase real stocks while, in fact, they were merely trading CFDs.

FXVC used pressure tactics, described by one customer as ‘relentless’, to encourage them to invest ever increasing sums of money. Some customers were even encouraged to declare they were professional investors despite not meeting the necessary criteria for such categorisation.

Shortly after the FCA’s crackdown, FXVC voluntarily turned their backs to Cyprus and decided to cease providing any investment services under its CIF authorization.

Read this next

Metaverse Gaming NFT

DCentral Miami brings together all of Web3, NFT, DeFi, Metaverse

The world’s biggest Web3 meeting entitled DCENTRAL Miami is set to take place November 28-29, featuring a lineup of some of the biggest and most influential names in the blockchain space.

Digital Assets

Crypto ban expands across UK banks as Starling joins ‎crackdown

UK digital bank Starling has banned ‎all customer payments related to cryptocurrencies, another blow for the crypto traders ‎who recently saw a sizable number of banks deciding not to ‎finance the wobbly asset class.‎

Interviews

Markets Direct at FIA EXPO 2022: Traders know what they want from brokers

The FIA Expo 2022, one of the most prestigious events within the global derivatives trading industry, took place in Chicago on 14 & 15 November.

Interviews

FIA Expo 2022: TNS addresses public cloud limitations with hybrid infrastructure

November is the month of the FIA Expo, one of the largest futures and options conferences in the world, bringing together regulators, exchanges, software vendors, and brokers in one place: the Sheraton Grand Chicago Riverwalk. 

Retail FX

Italy’s regulator blacks out Finance CapitalFX, MFCapitalFX

Italy’s Commissione Nazionale per le Società e la Borsa (CONSOB) has shut down new websites in an ongoing clampdown against firms it accuses of illegally promoting investment products in the country.

Retail FX

Suspected leader of Honk Kong ramp-and-dump scam appears in court

A leader of a sophisticated ramp-and-dump scheme made his first court appearance in a Hong Kong court today, charged with market manipulation and various criminal offences. The case stems from an earlier joint operation of Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), and the local police. 

Institutional FX

Cboe’s James Arrante discusses growing demand for fixed income, FX algo

We caught up with James Arrante, senior director of FX & US treasuries product and business management at Cboe Global Markets, to uncover emerging trends in the FX and fixed income markets and learn more about the bourse operator’s recent initiatives.

Retail FX

Eurotrader acquires UK broker Petra Asset Management

Eurotrader Group has formally entered into the UK market with the acquisition of FCA-regulated broker, previously named Petra Asset Management Ltd. The new entity operates under the brand name Eurotrade Capital Ltd.

Inside View, Retail FX

The Game of Chess Continues – OPEC, China and the Oil Market

Over the past decade, the US has been complaining about the amount of power which the BRIC group, and specifically China, has on the global economy. BRIC stands for Brazil, Russia, India and China; these were the world’s fastest growing economies. Only in the past 10 months, the US has turned their attention toward OPEC due to the prices of fuel. Nevertheless, China seems to have a strong influence even over the price of crude oil.

<