FCA Removes Permissions of 3 Cyprus Firms to Sell CFDs


FCA has notified UK consumers that 3 Cyprus registered firms no longer hold relevant permissions to sell contracts for difference (CFDs) to UK consumers. 

June 16 2020 | AtoZ Markets – The UK Financial Conduct Authority (FCA) has published a notice regarding Cyprus CFD firms Maxiflex Ltd (trading as EuropeFX), Maxigrid Limited (trading as Dualix & AGM Markets), and Reliantco Investments Ltd (trading as UFX).

Removal of these firms’ permission to sell CFDs to UK consumers

UK consumers are informed that these Cyprus registered firms no longer hold relevant permissions to conduct regulated activities with UK consumers. This follows FCA receipt of notifications from the Cyprus Securities and Exchange Commission (CySEC) about the provision of investment services by these firms, which operate under CySEC authorization and have previously marketed into the UK utilizing the EEA passport regime.

The CySEC notifications confirmed that these three CFD providers had decided to cease to provide any investment services in the UK as follows:

  • Maxiflex Ltd, as of 4 June 2020;
  • Maxigrid Limited, as of 5 June 2020; and,
  • Reliantco Investments Ltd, as of 11 June 2020.

As of the dates above, these CFD brokers are no longer permitted to open new accounts for consumers in the United Kingdom.

Information for consumers with accounts at these Cyprus CFD firms

Existing UK account holders with open positions and/or cash balances should review notifications provided on the respective firms’ websites and/or firm communications to UK clients sent by email or available at account log-in.

The firms should clearly set out the process and timelines for their ongoing interactions with their existing UK-based customers.

UK consumers who are not satisfied with any aspect of the handling of their trading accounts are advised first to complain to the firm directly.

The firm must acknowledge receipt of one’s complaint within five days and then provide a material response within two months, telling a customer whether the complaint has been successfully resolved or why they need more time to look into it (up to a maximum of three months from the day of complaint).

If a customer is not happy with the firm’s response, or they fail to respond, this customer can ask the Cyprus Financial Ombudsman to consider this customer’s complaint.

FCA clamps down on unauthorized Cypriot Firms

As AtoZ Markets reported, the FCA banned four Cypriot investment firms in order to stop them from continuing to offer high-risk CFDs to UK investors. The UK watchdog explained that these firms – Hoch Capital Ltd (trading as iTrader and tradeATF), Magnum FX (Cyprus) Ltd (trading as ET Finance), Rodeler Ltd (trading as 24option) and F1Markets Ltd (trading as Investous, StrattonMarkets, and Europrime), used unauthorized celebrity endorsements on social media as part of their marketing. The firms used social media and webpages carrying fake endorsements from celebrities to entice consumers into the scams involving CFDs.

Related: How to Verify FCA UK Forex Brokers License Legitimacy

The orders require the four companies to stop selling CFDs to UK customers, to close existing positions with UK customers, to return UK customers’ money, and to notify UK customers of the FCA’s action.

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