CySEC fines ICFD Ltd for compliance failings

Maria Nikolova

A fine of €138,000 has been imposed on the company for multiple compliance failings.

The Cyprus Securities and Exchange Commission (“CySEC”) has today imposed a financial penalty on ICFD Ltd (the “Company”), an investment firm that provides online retail trading products in forex. A fine of €138,000 has been imposed on the Company for multiple compliance failings.

These failings that occurred in 2016 breached the policies and procedures CySEC enforces on Cyprus Investment Firms (“CIFs”) in order to guarantee full investor protection.

The identified failings included a non-compliance with:

  •  Section 6(8) of the Investment Services and Activities and Regulated Markets Law of 2007, as amended (‘the Law’),
  •  Section 28(1) of the Law, as it failed to comply, at all times, with the authorization and operating conditions laid down in sections 18(2)(a) and 18(2)(d) of the Law, as specified in paragraphs 14 and 16 of Directive DI 144-2007-01 of 2012 of the Securities and Exchange Commission for the Authorisation and Operating Conditions of CIFs (“Directive 1”),
  •  Sections 36(1), 36(1)(a), 36(1)(b) and 36(1)(d) of the Law and paragraphs 4, 6, and 16 of Directive DI 144-2007-02 of 2012 of the Securities and Exchange Commission for the Professional Competence of Investment Firms and the Natural Persons Employed by them (“Directive 2”).

In non-compliance with these regulatory obligations, the Company’s specific failings concerned:

  •  The Company provided investment services it was not licensed to offer by CySEC, including the investment advice itself;
  •  The Company did not take reasonable steps to avoid operational risk deteriorating when running its business and/or when outsourcing activities to third party service providers;
  •  The Company did not act fairly, honestly and professionally to serve the best interests of its clients at all times;
  •  In providing information addressed to clients and potential clients from employees of its call centres, the disclosure on the Company’s website, and the contents of the Company’s advertising was not clear, accurate and not misleading. These materials consistently failed to alert clients and potential clients to the risks of and warnings in investing;
  •  In providing information addressed to clients and potential clients, the Company failed to ensure it sufficiently communicated the nature and risks of the investment service(s) offered;
  •  The Company was therefore unable to assess whether the proposed investment service or financial instrument provided to them by the Company was suitable for these clients;
  •  The Company did not source or collect the necessary information from its clients and potential clients regarding their relevant knowledge and experience to trade in the particular financial products it was offering;
  • Further, the Company encouraged clients and potential clients to not provide the information required for the purposes of Article 36(1)(d) of the Law, in demonstrable violation of the explicit legislation.

In addition to the financial sanctions imposed on the Company, CySEC has also enforced a number of corrective actions, in respect to the above deficiencies, to ensure full compliance with the Investment Services and Activities and Regulated Markets Act of 2017 (Law 87(I)/2017), which entered into force on 3 January 2018 and harmonises the Cyprus legal framework with Directive 2014/65/EU on Markets in Financial Instruments (MiFID II).

Demetra Kalogerou, Chair of CySEC, said:

“Following CySEC’s investigation, the Company was found to be in violation of the laws we have in place and enforce to protect retail investors trading in speculative financial products, such as forex. The Company in question showed, among others, deficiencies in properly disclosing the risks to existing and prospective investors, and in some cases, even served to promote and actively market certain products at the expense of providing clear and non-misleading information. Having enforced a number of corrective measures in addition to those financial penalties imposed on the Company, CySEC will continue to keep the Company under close supervision and it will remain subject to follow-up inspections.”

Read this next


US and South Korea seek extradition of Luna founder Do Kwon

Both US and South Korean officials are seeking to extradite Terraform Labs CEO Do Kwon, just hours after he was arrested in Montenegro.

Retail FX

Pepperstone UK doubles profit, client assets in 2022

The London-based entity of Australian FX broker Pepperstone has reported its financials for the fiscal year ending June 30, 2022. The group had outperformed the last year’s flat performance, having doubled revenues and boosted the broker’s bottom line and shareholders’ fortunes.

Institutional FX

CLS FX volume rises to just shy of $2 trillion in February

Foreign exchange settlement provider, CLS Group saw strong volumes in February 2023 as the banking crisis continues to weigh on a world economy that’s yet to fully recover from the Russia-Ukraine war’s shocks.

Digital Assets

Binance restores trading after 2-hour outage

Binance suffered a breakdown on its trading engine that lasted for about two hours, but the premier cryptocurrency exchange finally managed to restore normal operations at around 14:00 UTC.

Digital Assets

Tether earns $700 million in Q1, taking excess reserves to $1.6 billion

Tether chief technology officer Paolo Ardoino said the world’s largest stablecoin issuer expects to earn more than $700 million in the January-Mach quarter, which will be added to the reserve backing its stablecoin (USDT).

Digital Assets

Narwhal Finance Secures $1M in Seed Funding Led by Animoca Ventures

Narwhal Finance received strong support from Animoca Ventures and angel investors in a $1 million seed funding round, reinforcing the company’s vision of providing an accessible platform to all.


SteelEye tries ChatGPT for market surveillance

This capability can be used as a starting point for initiating a surveillance investigation and to standardize workflow processes to boost the throughput and consistency of cases. It is also useful when analyzing communications in foreign languages, as the system returns the above insights in English regardless of the languages being used.

Industry News

SEC charges ex-Morgan Stanley advisor of NBA players after $13m fraud

Darryl Matthew Cohen was arrested this week and is facing three different federal counts of fraud, which could amount to 20 years in prison if convicted, besides the SEC complaint. 

Industry News

AWS FinTech Africa Accelerator launched, applications until April 27, 2023

Founders will be offered tech resources, expert guidance, and a global network of industry leaders, technologists, entrepreneurs, investors, associations, and partners, in order to build their fintech products.