The Cyprus Securities and Exchange Commission issued a warning on Thursday to Cyprus Investments Firms (CIFs). The message was particularly aimed at the ones trading in CFDs.
The Cypriot regulator advised brokers to take immediate action and improve their practices or they will face enforcement action. CySEC warned that brokers who repeatedly have issues with compliance will see “significantly higher” fines. Additionally, the regulator might even suspend or revoke their CIF licence.
The warning comes as the regulator is introducing additional controls for cross-border services and is strengthening investor protection with new rules regarding how complaints are handled. CYSEC highlighted regulatory compliance and investor protection as supervisory objectives for for 2022—2023.
To achieve these goals, the regulator will obligate firms to appoint an internal auditor to undertake an investigation and submit a report after they received 20 and more complaints.
Chairman of Cyprus Securities and Exchange Commission (CySEC), Dr. George Theocharides, said:
To achieve CySEC’s mission to exercise effective supervision, ensure investors’ protection and the healthy development of the capital market, CySEC is adopting changes to its supervisory processes when it comes to monitoring cross-border activities.
This will ensure that poor practices and possible violations of the law are adequately identified, assessed, addressed, and prioritized when needed.
To achieve these goals, the regulator will obligate firms to appoint an internal auditor to undertake an investigation and submit a report after they received 20 and more complaints.
Additionally, CySEC is introducing more controls to probe the organisational structures of new applicants and to ensure they can adequately carry out and monitor cross-border activities. Focus will be placed even on advertising campaigns to safeguard against aggressive marketing behaviour, misleading information to investors, or any other abusive practices.
Dr. George Theocharides, added:
Those who seek to violate the law have no place in Cyprus. CySEC aims for a stronger, safer, more responsible market both in Cyprus and across Europe.
The Cypriot regulator announced in the beginning of the week of the launch of its new Investor Protection campaign, aiming to battle the growth international threat of investment harm. The campaign is part of the CySEC’s endeavors to warn investors against making investment decisions based on emotions and social pressure and urge them to operate with rational thinking and knowledge of the market.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
