In what could be a fallout from the investigation by the U.K. Financial Conduct Authority of Plus500’s on-boarding procedure, a UK regulated forex and CFDs brokerage has announced that it is suspending services to EU clients.
AlfaTrade has issued an announcement on its website explaining that its FCA license has been temporarily suspended. Sources with knowledge of the matter shared with Finance Magnates’ reporters that the firm is looking to relocate its business to Cyprus and get regulated by the Cyprus Securities and Exchange Commission (CySEC).
The company cites reasons for the move as “unforeseen circumstances”
The move could be related to an increased scrutiny by the FCA about account opening procedures. As of today, the license is still listed as active on the regulator’s website, despite the suspension announcement on the website of the brokerage, thus leading to a conclusion that the license might have actually been suspended by the brokerage on a voluntary basis, although differing with the company’s official statement.
What the company cites as reason for the move are “unforeseen circumstances”.
AlfaTrade proceeds in its announcement stating that all client funds are still subject to the official regulatory requirements by the U.K. regulatory watchdog and are not at risk. Clients outside of the European Union remain unaffected by the trading suspension.