HotForex Fined by CySEC €105,000 for Outsourcing Calls and Misrepresenting Risk
- HotForex has become the latest brokerage regulated in Cyprus to be fined by the national regulator.
The board of 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 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) has fined HF Markets, the parent company of HotForex. It was fined in January 2016 for multiple violations of the securities laws in the country. The fine totaled €105,000 with a detailed breakdown of the different violations officially published by the regulator.
According to CySEC’s announcement, HotForex failed to comply with legal obligations that require it to adequately maintain records of business operations. The firm had been outsourcing some of its activities to third parties and could not provide the regulator with an official agreement of the service provider to which it was outsourcing its customer services.
In addition the company had not been maintaining records of the phone conversations between its customer service reps and clients. Due to this, CySEC has not been able to ascertain whether the firm had been complying with regulations when communicating with clients.
Another €20,000 was added to the fine because HotForex was not “acting fairly, honestly and professionally in accordance with the best interests of its clients”. This count is related to the practices of the employees of the company and the terms and conditions which the firm presented to its customers.
A further €30,000 fine was added to the total for unfair, unclear and misleading marketing information. Due to the lack of appropriate risk disclosure the firm’s bill with CySEC has increased another €15,000.
The final €20,000 of the fine is attributed to lack of maintenance of an adequate record of client agreement documents.
The board of 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 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) has fined HF Markets, the parent company of HotForex. It was fined in January 2016 for multiple violations of the securities laws in the country. The fine totaled €105,000 with a detailed breakdown of the different violations officially published by the regulator.
According to CySEC’s announcement, HotForex failed to comply with legal obligations that require it to adequately maintain records of business operations. The firm had been outsourcing some of its activities to third parties and could not provide the regulator with an official agreement of the service provider to which it was outsourcing its customer services.
In addition the company had not been maintaining records of the phone conversations between its customer service reps and clients. Due to this, CySEC has not been able to ascertain whether the firm had been complying with regulations when communicating with clients.
Another €20,000 was added to the fine because HotForex was not “acting fairly, honestly and professionally in accordance with the best interests of its clients”. This count is related to the practices of the employees of the company and the terms and conditions which the firm presented to its customers.
A further €30,000 fine was added to the total for unfair, unclear and misleading marketing information. Due to the lack of appropriate risk disclosure the firm’s bill with CySEC has increased another €15,000.
The final €20,000 of the fine is attributed to lack of maintenance of an adequate record of client agreement documents.