The Cyprus Securities and Exchange Commission (CySEC) has announced that Cyprus Investment Firm (CIF) UBFS Invest, backed by broker Moneychoice Brokers Ltd, is suspended with immediate effect, following several allegations of multiple violations, according to a CySEC statement.
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UBFS Invest provides FX trading systems for market participants. The suspension of its authorization by CySEC was dictated by multiple suspicions of violations that ran counter to the regulator’s markets law.
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In particular, UBFS Invest is being accused of noncompliance, in that it did not properly protect or provide safety of its clients’ funds. In addition, UBFS Invest appears to have a problem with capitalization, as its own funds have fallen below the requisite capital requirements set by CySEC. By extension, the group’s total capital ratio is also below the necessary requirements, based on European regulatory measures as well as the necessary levels set by CySEC.
CySEC decided to take immediate action in a bid to help protect client funds, which will ultimately require a number of actions by UBFS Invest to regain its authorization as a regulated entity. The group has one month to take the necessary actions, as well as to comply with several other directives whilst the suspension is in effect.
While the suspension is in effect, UBFS Invest cannot provide any more services to clients, specifically, entering into new business relationships. Furthermore, the group is not eligible to receive, transmit, or execute any orders from clients for the purchase of new instruments. Finally, UBFS Invest cannot provide any investment services in Cyprus for the duration of the suspension.
Earlier today, CySEC issued a communique levying a suspension of the licenses of the parent company of SkyFX and Capital Option. The decision had been taken at a board meeting of the watchdog on the 25th of April and is a follow up to the regulator’s decision from February 2016.