Two brokers say Goodbye to their CySEC authorization

abdelaziz Fathi

The Cyprus Securities and Exchange Commission (CySEC) confirmed that it has wholly withdrawn the Cyprus Investment Firm (CIF) licenses of MPS Marketplace Securities and Sharelink Securities & Financial Services Ltd.

According to two regulatory announcements, both firms had their CIF authorizations withdrawn on its own request and the surrender of their respective license was entirely voluntary, not the result of any regulatory action taken by CySEC.

MPS Marketplace Securities offers liquidity solutions for financial brokers, banks, hedge funds, as well as asset management companies. The company also provides its corporate clients with trading performance solutions like execution services and back office for post-trade risk management and real-time trade monitoring.

A visit to the broker’s website reveals that MPS hasn’t proceeded with changes in its website to remove any references regarding authorization and supervision of the company by CySEC. Sharelink also has yet to update its website to reflect the final withdrawal of its CIF license.

Although the regulator did not state why both firms decided to say goodbye to their Cypriot identity, it has recently seen many regulated brokers opt to voluntary surrender their license.

The exact reasons leading up to this decision remain unclear, but CySEC will certainly maintain supervision over the companies until they have taken care of its responsibilities under the license.

Under the Cypriot regulatory framework, each company must return all outstanding balances to its clients and handle all of their complaints. In addition, MPS Marketplace and Sharelink Securities must provide a confirmation from their external auditor that they don’t not have any pending obligations and must include details of each of the company’s clients, according to the same CySEC announcement.

The regulator often gives the broker three months from that date to settle its obligations arising from the investment services that also lapsed, during which time it remains under the Cypriot watchdog’s supervision.

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.

 

Read this next

Inside View

Private Equity Renaissance

Recent years have seen a resurgence in the concept of trading physical equities, with a slew of new arrivals joining the market for what is arguably one of the oldest forms of investing. But what has been the driving force behind this change in momentum?

Digital Assets

Dubai introduces new crypto regulations with fines of up to $135,000

Against the backdrop of a crashing market and burned investors, Dubai has sealed a landmark rulebook that governs how the Emirate will regulate cryptocurrency activities.

Institutional FX

FX volume drops 16pct at Russia’s largest exchange in January

The Moscow Exchange, Russia’s largest exchange group, released its monthly batch of trading volumes and metrics for January 2023 – the latest readings showed a pullback across the board for multiple segments, namely in the FX, given lower volatility and a reduced trading schedule.

Institutional FX

Standard Chartered sets up wholly-owned brokerage arm in China

UK-headquartered bank Standard Chartered said its Hong Kong arm has been granted an in-principle approval for a brokerage license from the China Securities Regulatory Commission (CSRC).

Digital Assets

Revolut offers staking for Ether, Cardano, Polkadot, and Tezo

British fintech and banking firm Revolut has introduced crypto staking — a practice of earning rewards for serving as a transaction validator in the Ethereum blockchain – to its UK and European Economic Area (EEA) customers.

Inside View

Saxo releases Q1 2023 Quarterly Outlook: “The Models Are Broken”

“2023 is likely to prove a rough ride for currencies if the USD bear market fails to continue in a straight line, but EUR and JPY may outperform.”

Institutional FX

FXPA welcomes Mesirow as a member of the institutional FX industry body

“Our deep commitment to advancing best practices align well with FXPA’s goals of championing a robust FX market for all industry participants.”

Industry News

ICE delivers Russian-free barrels of ICE Gasoil and expands ESG data in APAC

ICE changed the methodology for Low Sulphur Gasoil futures from previously delivering diesel from any origin, to deliver diesel that does not include any originating from Russia. ICE Gasoil is the global benchmark for refined oil products.

Digital Assets

Gate.io taps Coinfirm for AML/CFT compliance amid licenses in the US, Europe, Hong Kong

“At Gate.io, we continuously strive to mitigate AML/CFT and counterparty risks by integrating best-in-class security measures and safeguards into every part of our operations.”

<