FCA Warns Public that EuroFX is not Authorised
The UK Financial Conduct Authority issued a warning on Monday against many entities, including a forex brokerage firm that has been falsely claiming registration.
All firms and individuals offering, promoting or selling financial services or products in the UK have to be authorized by the FCA.
The UK watchdog has blacklisted a forex and CFDs broker named EuroFX, operating through https://eurofx.trade, which claims that it is offering a legal product. Reviewing the company’s website didn’t yield much valuable information regarding its operation, except for the usual claim of being a leading investment firm.
The watchdog warned that this brokerage firm may be a scam and added that it was flagged for operating and targeting UK citizens without a license. The FCA pointed out that the company is based out of an undisclosed jurisdiction while soliciting its clients using a brand claiming registration in Commonwealth of Dominica. Even if true, the island country in the Caribbean is known to be a harbor for many illegitimate brokers.
Interestingly, EuroFX has chosen to operate under the same brand name of a forex pyramid scheme that has gone into liquidation in 2016. EuroFX scammed thousands of investors in China and other countries through a major trading scam, which was run through UK companies alongside a New Zealand financial service provider.
The high-profile licenses helped the firm defraud close to 4,000 people around the world out of more than $632.3 million.
The warning is another step in the FCA’s tireless efforts to crack down on unregulated firms posing as legitimate approved businesses with full force. The regulator has previously issued warnings against similar companies, urging the public to beware of firms working outside the law and without the proper necessary approvals.
“Dealing with financial firms that are authorised or registered by us gives you greater protection if things go wrong. Check the Financial Services (FS) Register to ensure they are authorised or registered. It has information on firms and individuals that are, or have been, regulated by us,” the regulator said.
The FCA operates as a watchdog for financial trading, securities, and markets in the UK, overseeing a variety of assets and compliance issues for traders and consumers.
In order to prevent such fraudulent practices, FCA has issued several guidelines which encourage potential investors to be wary of promises of disproportionate returns. City watchdog has also advised the public to always verify the company’s identity (identity details, country of establishment, etc.) and to never trust a company if it cannot be clearly identified.