The Cyprus Securities and Exchange Commission (CySEC) has imposed a hefty fine on the Cyprus Investment Firm’s (CIF) MCA Intelifunds. In total, this administrative penalty amounts to €360,000.
CySEC Slaps CIF MCA Intelifunds With €360,000 Fine
According to a press release on Friday, 19 April 2024, the financial watchdog’s board claims that CIF transgressed numerous regulations in the Investment Services and Activities and Regulated Markets Law of 2017. The decision follows an investigation conducted in September 2022.
A breakdown of this fine includes €80,000 for not having adequate policies and procedures in place to comply with authorisation conditions and €25,000 for not taking reasonable measures in marketing and distributing financial instruments. The largest portion of this sanction is €150,000 for not providing honest and fair investment advice to clients. Other alleged trespasses included not warning existing or prospective clients about inappropriate financial products and not gathering all the needed information about investment experience.
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CySEC indicated that it considered multiple factors before imposing the fine. The media statement on the regulator’s website said:
CySEC also took into account that the CIF has the responsibility to comply with its obligations and that, with its omissions at the essential time, it did not ensure the protection of its clients’ interests, to which CySEC attaches particular importance.
According to CySEC, a brokerage or investment firm that fails to consider the best interests and exposure risks of its clients does not comply with the relevant legislation. The regulator also said that obtaining the needed information on the experience and knowledge of clients is essential to gauge the suitability of an investment.
