CySEC fines parent firm of InstaForex €130,000


CySEC fines parent firm of InstaForex, InvestCity, and ForexMart €130,000 over inappropriate client-related practices. According to the official announcement from the regulator, the CySEC has decided to divide the fine into two parts. 

2 August, AtoZ Markets – The Cypriot financial markets’ regulator, the Cyprus Securities and Exchange Commission (CySEC) has issued a new announcement on its website. This time, the Cypriot watchdog has informed the public about the issuance of a €130,000 fine to one of the regulated Cyprus Investment Firms on the island.

CySEC fines parent firm of InstaForex €130,000

The company under the spotlight this time is the brokerage group called Instant Trading EU Ltd. The company is responsible for operating several retail Forex brands, including ForexMart (forexmart.com), InstaForex (instaforex.eu) and InvestCity (investcity.com) Retail FX brands.

According to the official announcement from the regulator, the CySEC has decided to divide the fine into two parts. The supervisor explains:

“€90.000 for non-compliance with article 36(1) of the Law, as it did not act fairly, honestly and professionally in accordance with the best interests of its clients. 

€40.000 for non-compliance with article 36(1)(d) of the Law and paragraphs 15 and 16 of the Directive, as it failed to ask clients to provide the necessary information regarding their knowledge and experience, to assess whether the investment service or product is appropriate is appropriate for them.”

How did CySEC make this decision?

The regulator further noted that the company has implemented corrective actions and did not commit any similar breaches in the past. While making its decision, the regulator has taken into the consideration a number of factors. 

One of these factors is as follows, as per CySEC:

 “(i) The importance attributed by the legislator to violations of this kind, which is reflected by the maximum administrative sanction provided for violations of article 36(1) of the Law, in article 42(3) of the Law, i.e. €350.000.”

Another two factors include the importance related to the necessity to ensure the full compliance of the market participants with the provisions of the law and the importance attributed to the obligations of the participants to act in the best interests of its clients.

We have tried to reach out to the company for further insights, but did not receive any response yet. We will keep you updated once there will be some developments concerning the case.

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