Apparently the HFSA (Hungarian FSA) issued the following statement regarding iForex – a pretty large retail forex broker operating in Europe and Middle East regions. After a thorough examination iForex was found violating many rules governing its operations. iForex’s forex license was then suspended for six months and it was fined $100k. Full detail of the case (in Hungarian) is found here.
Excuse Google’s translation:
The Financial Supervisory Authority (FSA) after a thorough examination of 20 million to pay the fine iFOREX Investment Services Zrt (the Company), and six-month suspended the company’s online foreign exchange trading business license.
The FSA in January 2011 the Company conducted a comprehensive study, which concluded that the Company’s foreign exchange trading platform via the internet service provided in many cases violated the laws governing the operation.
The FSA decided that the Company’s major customer has infringed the rules of protection that is not given full information to clients of the service characteristics of the risks, and other service companies involved in the implementation of the role. The Company’s business license was suspended in view of the Company currently does not have the level of capital required by the rules of operation and technical conditions. If the Company during the period of suspension of the FSA to confirm that the study classified by insufficient material and technical conditions established and functioning before the expiry of the six-month suspension is continued.
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The Company during the period of suspension of the license agreement can not enter into new customers, existing customers may not incur new obligations against the resulting contracts, but must meet its obligations, the clients open positions of the suspension is not affected.
The decision to prevent money laundering legislation is also found violations, it required the company to identify customers in accordance with legislation.
The FSA to eliminate the Company’s recovery plan and a plan for internal audit actions taken pursuant to the reporting obligations imposed. In addition, each month, the company must give notice to the Supervisory Authority for major customer data.
2011th July 8, Budapest
Financial Supervisory Authority