CySEC latest news: UBFS Invest license suspended

30 May, AtoZForex, Vilnius — Recently, the Cyprus Securities and Exchange Commission (CySEC) has been taking harsh measures against some of the Cyprus Investment Firms (CIF). Considering that the Cypriot regulator  suspended a number of broker's licenses as well as updated the CIF rules.

According to the latest announcement, a new broker's license got suspended. The CIF in question is UBFS Invest, as UBFS Invest license suspended. The UBFS Invest is specialized in the Forex market for individual and institutional clients.  The CIF firm invests offers a wide variety of services for account holders and is assisted byMoneychoice Brokers Ltd. An interesting note, is that the broker was preparing for a co-sponsorship deal with the Mercedes-AMG DTM team for this year. Yet, with a license suspended

UBFS Invest's capital deficiencies

The suspension of CIF license took place mainly due to capital deficiencies of UBFS Invest firm. As it is presented on the CySEC official website, the license was temporarily suspended for the next alleged violations:

1. section 28(1) of the Law, for, as it appears, the non-compliance by the Company with the requirement for authorisation referred to in section 18(2)(j) of the Law (protection of clients’ funds),

2. section 67(1) of the Law, as its own funds appear less from the sum of its capital requirements,

3. Article 92(1) of the European Regulation as its total capital ratio appears less than the requirements This decision was taken due to the possibility of endangering the company’s clients’ interests and overall capital market’s operations, as reported by CySEC.

What is next for UBFS Invest?

Having UBFS Invest license suspended, of the CIF firm will need to immediately take action to remedy the case. It starts with UBFS Invest’s obligation to arrange the following orders within a one-month time span:

While the license suspension is in force,

1. The Company cannot, pursuant to section 26(5) of the Law, provide any services, and more specifically:

1.1. Cannot enter into a business relationship with any person and take upon any new client.

1.2. Cannot receive, transmit and execute any orders from clients for buying financial instruments.

1.3. Cannot provide any investment services in Cyprus or outside Cyprus (in member states and third countries).

1.4. Cannot advertise itself as an investment services provider and should upload on all of its websites that its CIF licence has been suspended.

2. The Company must, if existing clients so wish, without being considered in violation of section 26(5) of the Law:

2.1. Close any open positions in relation to clients’ contracts, or of its own, on their maturity date, or on an earlier date if the client so wishes.

2.2. Return to existing clients all of their funds and profits earned, if and when the clients so wish.

UBFS Invest Mercedes co-sponsorship endangered?

Furthermore, UBFS Invest is required to put the notice on its official website, and the links of both the portfolio management and brokerage sites should be taken offline. During the suspension period, UBFS Invest cannot provide any investment services in Cyprus. What is more, the CIF firm is unable to provide any services to customers, as well as to receive, perform, or transmit any orders from customers for the purchase of new instruments.

What is more, the UBFS Invest has been working closely with Mercedes-AMG DTM team. The CIF company was to become a stakeholder via the Mercedes Team, as well as they made a co-sponsorship deal with Mercedes in 2016. Having UBFS Invest license suspended, it remains unclear if the co-sponsorship deal with Mercedes will still take place.

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