The Cyprus Securities and Exchange Commission (CySEC) has settled with two regulated retail brokerage operators based on the island for ‘any violation or possible violation’ of local regulations. One of them is F1 Markets, and the other is Magnum FX (Cyprus).
Both the Cyprus Investment Firms (CIFs) settled with the regulator, paying €150,000 each. Though announced on Tuesday, the decisions by CySEC ‘s Board for the settlement were made on 14 March 2022.
For Magnum FX (Cyprus), the settlement was reached after an onsite regulatory inspection of the company that concluded concerns regulating the compliance measures between January 2019 and July 2020.
Some of the regulatory concerns were related to the requirements of CIF authorization and compliance with operating license conditions. The regulator further raised concerns around general principles and information addressed to clients and conflicts of interest.
For F1 Markets, the settlement came with a regulatory assessment of the company’s compliance efforts for the fulfilment of the conditions of its partial suspension and other corrective measures taken between June 2019 and July 2020.
Most of the concerns around F1 Markets were the same as Magnum except for the compliance around operating licenses. Additionally, the regulator flagged compliance around organizational requirements for F1 Markets.
Past Violations
The latest settlement with the brokers came after several enforcement actions had previously been brought against them. The licenses of both the brokerages were suspended by CySEC in mid-2020 for a couple of weeks.
At that time, the suspension came upon a request from the UK’s Financial Conduct Authority that accused the brokers of using fake celebrity endorsements to promote their products on social media.
Meanwhile, CySEC is tightening its regulatory requirements for contracts for differences (CFDs) brokers operating from its jurisdiction. It even submitted a plan with ESMA to implement a series of recommendations made by the European regulator earlier in March.
The Cyprus Securities and Exchange Commission (CySEC) has settled with two regulated retail brokerage operators based on the island for ‘any violation or possible violation’ of local regulations. One of them is F1 Markets, and the other is Magnum FX (Cyprus).
Both the Cyprus Investment Firms (CIFs) settled with the regulator, paying €150,000 each. Though announced on Tuesday, the decisions by CySEC ‘s Board for the settlement were made on 14 March 2022.
For Magnum FX (Cyprus), the settlement was reached after an onsite regulatory inspection of the company that concluded concerns regulating the compliance measures between January 2019 and July 2020.
Some of the regulatory concerns were related to the requirements of CIF authorization and compliance with operating license conditions. The regulator further raised concerns around general principles and information addressed to clients and conflicts of interest.
For F1 Markets, the settlement came with a regulatory assessment of the company’s compliance efforts for the fulfilment of the conditions of its partial suspension and other corrective measures taken between June 2019 and July 2020.
Most of the concerns around F1 Markets were the same as Magnum except for the compliance around operating licenses. Additionally, the regulator flagged compliance around organizational requirements for F1 Markets.
Past Violations
The latest settlement with the brokers came after several enforcement actions had previously been brought against them. The licenses of both the brokerages were suspended by CySEC in mid-2020 for a couple of weeks.
At that time, the suspension came upon a request from the UK’s Financial Conduct Authority that accused the brokers of using fake celebrity endorsements to promote their products on social media.
Meanwhile, CySEC is tightening its regulatory requirements for contracts for differences (CFDs) brokers operating from its jurisdiction. It even submitted a plan with ESMA to implement a series of recommendations made by the European regulator earlier in March.
