CySEC withdraws license of BelightFX for violating CIF regulations
The Cyprus Securities and Exchange Commission (CySEC) confirmed on Friday that it has wholly withdrawn the Cyprus Investment Firm (CIF) License of Belight Capital Group Limited.
This is not a surprise, as Belight Capital, which operates the retail FX brand BelightFX, has already been suspended back in April 2020. When accessing the domain officially approved by CySEC, www.belightcapitaltroup.com, there was apparently no trading on this website even then.
The CySEC regulatory manifest went into detail on the grounds that the decision of license recall was made. In particular, BelightFX has had its CIF authorisation withdrawn because its board of directors lacked the required professional background.
BelightFX has also had lapses in its organizational requirements which, among other things, saw the company didn’t provide investment services during the six months preceding the suspension of its license. These arrangements also concern prudential requirements in regard to capital ratio and other financial metrics.
Under the aforementioned withdrawal of its authorisation, BelightFX is also not authorised to passport its services in other European markets. However, the company currently operates its business through offshore brands that do not have a valid license in the EU.
The exact reasons leading up to this decision remain unclear, but CySEC will certainly maintain supervision over the financial service company until it has taken care of its responsibilities under the license.
At the time, BelightFX has already proceeded with changes in its website to remove any references regarding authorization and supervision of the company by CySEC. However, this has yet to be updated to reflect the final withdrawal of its CIF license.
Under the Cypriot regulatory framework, the company must return all outstanding balances to its clients and handle all of their complaints. In addition, BelightFX must provide a confirmation from its external auditor that it does not have any pending obligations towards each of the company’s clients, according to the same CySEC announcement.
The regulator often gives the broker three months to settle its obligations arising from the investment services that also lapsed, during that time it remains under the Cypriot watchdog’s supervision.
Additionally, the company must transfer funds of those who did not withdraw their balances to the investor’s compensation fund, which can be claimed in due course. In any case, the clients of BelightFX are still entitled to benefits from the Investor Compensation Fund (ICF), which serves to protect the claims of covered clients and provide them with compensation in case a member could not meet its financial obligations.