1 April, AtoZForex, Lagos – France’s Autorité des Marchés Financiers (AMF) is revamping its effort towards cleansing the Forex and binary options industry of the land. The financial markets watchdog clarified certain facts in a recent press conference, pointing a finger at other regulators and football clubs for not doing enough to fend off the growing epidemic of unauthorized FX and binary options firms operating in the region.
The AMF discovered an exponential growth in unauthorized companies of this kind doing business in France. Back in 2010, only four of such companies were in existence, while as of 2015 the number had skyrocketed to 360, with client complaints also increasing 25 times more.
Unauthorized firms and football club sponsorships
In recent years, sports sponsorships have been a major means for trading platforms to get more publicity, especially deals with football clubs. The AMF has pointed a finger at football clubs for their lackadaisical attitude towards such deals, for going into partnership with unauthorized firms. A good example is the partnership deals signed between Italian Serie A side, U.S. Città di Palermo and InstaForex back in October 2015. The partnership allows for InstaForex to utilize the football club’s image in their online marketing, LED billboards, hospitality materials and home tickets.
However, InstaForex had been “blacklisted” by the French financial authorities back in January 2014, warning the public against dealing with this firm because it lacked the due authorization to carry out the business for which it purports, both in France and in the entire European region because InstaForex Companies Group holds no financial services license in any country.
AMF challenges other European regulators
The French regulator also published a comparative study of corporate governance codes between the AMF and nine other European countries, namely Belgium, Finland, Germany, Italy, Luxembourg, the Netherlands, Spain, Sweden and the United Kingdom. In the report, it was concluded that the AMF remained the only regulatory authority that engages in “naming” and “shaming” practices. Stating that:
“Of the 15 reports considered in 10 European countries, only the AMF report on application of the corporate governance code and, to a lesser extent, the report by the Finnish Securities Market Association, cited the companies that do not comply with the governance rules by name (name and shame).”
On top of it, it was reported that the AMF (France) and the Financial Services and Markets Authority (FSMA, Belgium) are the only public authorities, which made recommendations to issuers regarding compliance with the provisions in the referenced code.
“The promise of easy money is a total deception”
Furthermore, as the AMF blames unregulated forex broker deals, the representative of the regulator condemned the operations of Binary Options brokers, having caused €4.5 billion in losses to French clients, therefore surpassing the VAT scam amid carbon credits under the EU’s Emissions Trading Scheme. “The promise of easy money is a total deception”, said the speaker.
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