CySEC warns of HYCM Capital Markets’ clone
The Cyprus Securities and Exchange Commission has once again stepped up its fight against unauthorized brokers.
The Cypriot regulator today published a warning against a slew of unlicensed providers, whose domains were just blacklisted for facilitating trading in FX and cryptocurrencies without being authorized to do so in the country.
CySEC also sounded alarm bells after it spotted a fraudulent scheme imitating brand of regulated FX broker HYCM. A company called HYCM Capital Markets is apparently another instance of a scam operation where an unlicensed company illegally assumes the identity of an authorized company so that traders will mistake it for the legitimate entity. The genuine company, HYCM, is the global brand name of Henyep Capital Markets (UK) Limited, HYCM (Europe) Ltd, Henyep Capital Markets (DIFC) Ltd and HYCM Limited, a global corporation founded in 1977, operating in Asia, Europe, and the Middle East.
CySEC added that some of these brands are misleadingly claiming affiliation other brokers that are already regulated in Cyprus and hold its CIF License. The watchdog has therefore blacklisted the following domains:
- edrfinancialltd.com
- ipo-experts.com
- firstbtcfx.com
- hycmcapitalmarkets.com
- aglotrade.com
As CySEC’s attitude of adopting more stringent licensing guidelines and operating regulations becomes ever clearer, certain aspects of the rules and operations start to come into sharper focus.
CySEC warns of ‘gamification’ and “finfluencers”
With many people afraid of missing out on the chance to make easy money, Cypriot regulators are launching a campaign to educate its citizens on the potential risks involved when it comes to online trading.
The country’s financial regulatory body (CySEC) is behind the campaign, which warns of using colorful apps that make trading seem empowering instead of intimidating .
The watchdog issued a public statement advising retail traders to be cautious when engaging so-called “finfluencers” and conduct serious due diligence on any prospective partners. It says those promoters must be licensed to give financial advice, or are authorised representatives of advisers. The same rules apply to influencers who earn affiliate commissions for referring their pages’ followers to online brokers, which also requires a licence to give such advice.
The regulator added that investment recommendations had to be produced in an objective and transparent way, so that investors could distinguish fact from opinions.
These warnings were in response to a rise in unregulated trading offers on online forums, and a concern that retail investors are not aware of the risks associated with following such tips.
