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CySEC suspends the license of AFX Capital Markets

Jul 19 2019
By
Jonathan Smith

 

The Cyprus Securities and Exchange Commission (CySEC) announced that the license of AFX Capital Markets is temporarily suspended due to suspicions of non-compliance regarding the safeguard of clients’ funds.

 

In particular, the regulator stated that “there are suspicions of an alleged violation of section 22(1) of the Law due to the Company’s possible non-compliance at all times with the authorisation condition in section 17(9) (organizational requirements) of the Law, as specified in paragraphs 4, 6 and 9 of Directive DI87-01, regarding the safeguard of clients’ funds”.

 

The broker’s license is suspended for a period of ten days, within which the company has to take actions to comply with the legal provisions applicable to Cyprus Investment Firms. Until then, AFX Capital Markets is not allowed to carry out investment services or activities, accept new clients, nor advertise itself as a financial services provider.

 

CySEC may take more severe measures after the expiration of the 10-days period. Most often, if a broker does not act accordingly to the instructions given and continues to breach the law, the regulator prolongs the suspension, and withdraws the license permanently, where necessary. For example, the Cypriot financial watchdog withdrew the license of the parent of binary options broker AnyOption previous year.

 

Cypriot forex brokers are subjected to a number of regulatory rules, such as keeping clients’ funds in segregated accounts, report regularly to CySEC, holding at least €730 000 at all times, and more. This provides clients of Cypriot brokers with significant assurance for the security of their funds. Besides, they have to adhere to all requirements introduced on a EU level.

 

TAGS: AFX Capital Markets  CySEC  license suspension  Cyprus 
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