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CySEC slaps fine on InstaForex and ForexMart parent

 

The Cyprus Securities and Exchange Commission (‘CySEC’) has imposed a total fine of €130.000 to the owner of InstaForex and ForexMart forex brokers, Instant Trading EU Ltd, for non-compliance with the applicable laws.

 

More specifically, the Company has failed to comply with certain provisions of the Investment Services and Activities and Regulated Markets Law regarding the use of leverage, the granting of bonuses to clients, and ensuring negative balance protection. For this non-compliance, the owner of InstaForex and ForexMart is fined with €90.000.

 

Another administrative fine of €40,000 was imposed on the company for failing to ask clients to provide the necessary information regarding their knowledge and experience, and to assess whether the investment service or product is appropriate for them.

 

In in determining the amount of the fine, CySEC took into consideration several moderating factors. First of all, the Company has not committed similar violations in the past. Second, it has taken corrective actions in relation to both incompliances.

 

The Cypriot financial watchdog has tight grip on local investment firms. In April, it fined the parent of Trade.com, Finexo and Forexyard with €30 000 for similar violations. Now that ESMA’s restriction on CFD trading have entered into force, CySEC might conduct more frequent check-ups on licensed forex brokerages to make sure that they comply with the new measures. These include a leverage cap of 1:30, provision of negative balance protection, and others.

TAGS: CySEC  fine  ForexMart  InstaForex  regulation 
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