The Cypriot regulator has started being stricter to the investment firms it supervises. Last month, it penalized XFR Financial Ltd. Now, CySEC fines Colmex Pro. What is the reason behind the penalty?
28 December, AtoZForex – A Cypriot-based brokerage Colmex Pro has received a penalty of €100,000 from the Cypriot watchdog, the Cyprus Securities and Exchange Commission (CySEC). The fine was issued to the firm due to a number of issues related to compliance.
Colmex Pro is a Cyprus Investment Firm (CIF), offering a variety of services to investors and its clients. According to the company, it provides different investment tools to its clients as well as has six platforms available.
CySEC fines Colmex Pro – Break down of fines
The announcement of the regulator states that it has imposed the charges as the company failed to comply with the authorization and operating conditions. The actual date when the CySEC board made the decision to undertake the enforcement actions was a month ago, on the 28th of November. But the regulator reported it only yesterday.
The total €100,000 penalty imposed on the brokerage is composed of the following parts. Firstly, Colmex Pro has to pay €40,000 as the brokerage has not managed to properly inform its clients about trading risks. Another €30,000 were charged due to the misleading advertising. Then, the regulator imposed €20,000 fine for not properly addressing operational risks. While Colmex Pro should pay the remaining €10,000 for other compliance and administrative issues. AtoZ Forex tried to reach out Colmex Pro, but the compliance department did not provide any extra comments in regards to the subject.
CySEC introduced stricter measures
Over a recent period of time, the Cypriot regulator has started introducing stricter measures. Last month, the CySEC banned bonuses promotions and ordered brokerages to reduce leverage. Further, the regulator issued a fine €225,000 to XFR Financial Ltd, a holding company of XForex in November. Since the company did not comply with the provision of trading services.
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