eToro fined €1.3 million in Italy for misleading users
Italy’s antitrust authority has fined the Israeli trading and multi-asset brokerage company eToro €1.3 million for misleading consumers about the true costs of its stock trading offering.
The Italian Competition Authority, AGCM, specifically accused eToro of promoting its stock trading platform as a zero-fee service. However, the social investment network failed to adequately inform users about costs associated with exchange rates and restrictions on transferring portfolios to other brokerage firms.
“The Authority states that eToro violated articles 20, 21, and 22 of the Consumer Code by failing to promptly and adequately inform users about the economic conditions and technical features of the offered products and services. This lack of transparency led users to make commercial decisions they would not have made otherwise,” the statement reads.
eToro said in an emailed statement to Reuters that they are fully transparent in communications with customers about their products.
“We firmly believe in the importance of consumer protection and providing consumers with exhaustive information. We are reviewing the decision by AGCM in full and we are considering our options,” the broker added.
eToro made headlines earlier this year when it partnered with Twitter to enable its users to view market charts and access real-time information about stocks, cryptocurrencies, and other financial assets.
The new feature was launched on the Twitter app and it effectively expands the platform’s $Cashtags feature. Additionally, users will be able to go directly to the eToro brokerage site from Twitter and invest in the assets they searched for. eToro claims that the partnership with Twitter will not only enhance financial education but also increase profitability.
In addition to the expanded $Cashtags feature and real-time price searches, users will be able to click on a “view on eToro” button within Twitter’s app, which will direct them to eToro’s platform to buy and sell an expanded range of financial instruments.
The partnership with eToro is part of Elon Musk’s plan to create an “everything app” for the platform. He previously expressed admiration for Tencent’s WeChat, which started out as a messaging app and has since evolved into an all-in-one platform. Musk also believes an “everything app” could be a solution to the problem of app overload, where users are forced to use multiple apps to complete different tasks.