CySEC Points Out Many Compliance Shortcomings in CIF Operations

The Cyprus Securities and Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Commission (CySEC) has published the results of a review of the compliance measures taken by the regulated entities on Wednesday, including FX and CFDs brokers, showcasing various discrepancies.

The regulator highlighted that many companies operating with a Cyprus Investment Firm (CIF) license are not specifying the severity of risks of the offered financial instruments, which is mandatory for all regulated firms.

Furthermore, many companies are not providing a proper annual compliance monitoring program based on the risk analysis, and also there were instances when the identification of risks and the monitoring priorities of the compliance function were vaguely determined.

The regulator additionally found discrepancies in reporting obligations on the part of these companies.

European Market Entry Point

Cyprus is home to many financial services companies. The low entry barrier of the jurisdiction has made it the preferred destination for the companies to run their European operations. Many London-based companies even moved to the island after Britain’s formal exit from the 27 country bloc to continue serving European clients.

Despite the popularity of the jurisdiction among the companies, multiple European companies have complained about these companies for breaches of local compliance rules.

“The circular sets out CySEC CySEC The Cyprus Securities and Exchange Commission (CySEC) is a financial regulatory authority of Cyprus. CySEC is one of the key watchdog authorities for brokerages in Europe, whose financial regulations and operations comply with the European MiFID financial harmonization law.Founded in 2001, CySEC is instrumental in providing licensing and registration for forex brokers and previously binary options providers.CySEC is responsible for a variety of different functions, which includes the supervision The Cyprus Securities and Exchange Commission (CySEC) is a financial regulatory authority of Cyprus. CySEC is one of the key watchdog authorities for brokerages in Europe, whose financial regulations and operations comply with the European MiFID financial harmonization law.Founded in 2001, CySEC is instrumental in providing licensing and registration for forex brokers and previously binary options providers.CySEC is responsible for a variety of different functions, which includes the supervision Read this Term’s key findings and invites all Regulated Entities to consider whether they comply with their obligations as per Article 17(2) of the Law, and, where appropriate, to take corrective measures,” the Cypriot regulator noted.

CySEC is now becoming strict in overseeing the regulated companies and has flagged and fined many corporations in recent years for serious compliance breaches.

Apart from the shortcomings, the regulator pointed out many positive practices followed by a bunch of companies that include regular management meetings and preparation of quarterly compliance reports.

“All Regulated Entities should consider the issues raised in this circular against their policies and arrangements in place in relation to the compliance with the compliance function requirements,” CySEC Chairwoman, Demetra Kalogerou stated.