de | cn | ru

Market News

ESMA warns forex brokerages not to circumvent its product intervention measures

Jul 12 2019
By
Jonathan Smith

 

The European Securities and Markets Authority (ESMA) has identified certain undesirable practices among CFDs providers, which raise concerns of non-compliance with the product intervention measures introduced a year ago. This became clear from a statement published on ESMA’s website on Friday.

 

More specifically, the Pan-European regulator expressed its concerns regarding the practices of some forex brokers related to professional clients on request and the marketing distribution or sale by third-country CFD-Providers.

 

Ensuring investors are protected necessitates that all CFD providers respect all applicable requirements and do not circumvent them using professional client status or third country entities,” the statement said.

 

The EU’s securities markets’ regulator said it is aware that some brokerages are advertising to retail clients the possibility to become professional client on request, which includes certain trading incentives, as well as providing higher leverage levels. We remind you that according to ESMA’s product intervention measures, which were made permanent in many EU countries, the leverage available to retail clients is capped at 1:30, and trading incentives such as bonuses are not allowed.

 

ESMA also said it is also aware that some CFD providers established in the EU are offering their clients to move their accounts to an intra-group third-country entity. The Pan-European regulator warned brokerages that third-country firms are only allowed to provide services to EU investors at the client's own exclusive initiative.

 

In an effort to avoid the ESMA’s rules, many European brokers are indeed using their offshore or Australian entities. That being said, the Australian Securities and Investments Commission (ASIC) even warned Aussie brokerages to be careful not to break any overseas laws while offering OTC derivatives to retail investors in Europe.

 

ESMA and national financial regulators will continue to monitor compliance of CFD providers with the product intervention decisions and undertake further measures, where necessary.

TAGS: ESMA  product intervention measures  professional clients  leverage cap  EU 
Forex
Broker Country Regulation Platform Min Deposit Review
Cyprus, UK, Mauritius CySec, FCA, FSC MT4, MT5, Web $10 Review Website
Cyprus, SVG CySEC MT5, Web,
cTrader
$100 Review Website
Australia, Cyprus ASIC, CySEC MT4, MT5, Iress $100 Review Website
Cyprus, Australia CySec, ASIC MT4, MT5 $5 Review Website
UK, Australia, South Africa FCA, ASIC, FSCA MT4, Trading
Station,
NinjaTrader
$50 Review Website
UK, Cyprus, UAE, South Africa FCA, CySEC, DFSA, FSB MT4, MT5, FxPro
Markets,
cTrader
$100 Review Website
Cyprus CySEC MT4, MT5, Web $1 Review Website
Belize IFSC MT4, MT5 $100 Review Website
Cyprus, UK, South Africa, UAE CySec, FCA, FSCA, DFSA MT4, MT5, Web $5 Review Website
Cyprus, UK CySEC, FCA MT4, MT5 $1 Review Website
UK FCA MT5 $5 Review Website
UK FCA MT4, Web, MT4
for Mac
$100 Review Website
Australia, UK ASIC, FCA MT4, MT5,
cTrader
$200 Review Website

More Forex Market News

UnitedData charged for a 42 mln ICO scam

Dec 13 2019 18:02:59

The Securities and Exchange Commission (SEC) in the U.S. has charged  Eran Eyal, founder of UnitedData, for conducting a fraudulent initial coin offering (ICO), which has scammed investors of some 42 million USD with unregistered securities. Read more

Three arrested in connection to a $722 mln crypto scam

Dec 11 2019 18:20:02

The U.S. police have arrested three individuals in connection to a crypto mining scam that costed investors over 722 million USD. Read more

China to launch bank backed digital currency in Shenzhen and Suzhou

Dec 09 2019 18:20:09

China's central bank, the People’s Bank of China (PboC), is proceeding with its plan to launch a central bank- backed digital currency (CBDC) in two major cities – the 14 million megalopolis of Shenzhen, which neighbors Hong Kong, and Suzhou - a historical city west of Shanghai. Read more

PlatiniumFX and Capital GMA end up on CONSOB’s warning list

Dec 09 2019 16:47:02

  The latest additions to the warning list of Italian financial regulator CONSOB (Commissione Nazionale per le Societa e la Borsa) are PlatiniumFX, Capital GMA, and several other unregulated brokers. Read more

CFTC warns about 20 new forex and binary options scams

Dec 06 2019 17:46:44

The US Commodity Futures Trading Commission (CFTC) updated its warnings list with twenty new forex and binary options scam websites, bringing the total blacklisted websites to nearly 150. Read more

Thai authorities seize over 15 million baht from Forex-3D scammers

Dec 06 2019 10:38:02

  Officials from the Thai Department of Special Investigation (DSI) seized over 15 million baht from the owner of Forex- 3D Ponzi scheme and his associates, the Bangkok Post reported on Thursday. Read more

EU finance ministers agreed to block Libra

Dec 05 2019 13:46:59

EU finance ministers have agreed that  private digital currencies like Libra – the crypto coin Facebook plans to launch in 2020, should not be allowed in the European Union until all possible risks are identified and properly addressed, Reuters reports. Read more

CFTC looks for a binary options scammer who defrauded investors with $3,8 mln

Dec 03 2019 17:20:38

The United States Commodity Futures Trading Commission (CFTC) apparently can not locate Peter Szatmari, who defrauded nearly 4 million USD from binary options investors. Read more

Bulgarian court allows the extradition of Gal Barak to Austria

Dec 02 2019 17:51:14

After a successful operation of the police in Austria, Germany, the Czech Republic and Bulgaria has lead in February to the arrests of several financial executives, among which the Izraeli citizen Gal Barak, who is charged of orchestrating an online trading scam, that allegedly has defrauded Europea... Read more

Italy’s CONSOB blacklists EvolutionBrokers and KapitalSwiss

Dec 02 2019 15:30:33

   Italy's financial regulator Commissione Nazionale per le Societa e la Borsa (CONSOB) has blacklisted a bunch of unregulated brokers today, including EvolutionBrokers, and KapitalSwiss. CONSOB also ordered internet providers to block access to their websites. Read more

de | cn | ru