Best Stories of the Week

Wild Week: Failed Broker Takeovers and Fines, Fines, Fines

Playtech, FxPulp, IronFX, EZ Trader and FXGM all appear in the passing week's top articles.

The online trading industry keeps to its fast pace, with just one week bringing to light enough revelations to change the entire ecosystem. Among the top stories of the past week, we have seen: a major gaming empire that went on a broker buying binge but had to give up on the takeovers that would have solidified its hold on trading; and a national regulator that was considered by many as being lenient on brokers suddenly acting tough and shooting out fines on rapid fire. On a positive note we have also seen a binary options developer crossing over to the online video ads space, an area that can definitely use some disruption.

Playtech Hits a Roadblock

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On Monday, Playtech made an announcement that caught many by surprise as it dropped its plans to acquire the publicly-listed CFD broker Plus500 due to FCA concerns that Playtech found impossible to resolve. The gaming giant said it discussed developments with the target company and the two had agreed to terminate their negotiations.

Just hours after the announcement that it has chosen not to further pursue the acquisition deal with Plus500, the news came through the London Stock Exchange that the shareholders of AvaTrade have suspended Playtech’s other major FX deal.

FxPulp Pulped

On Tuesday it was revealed that the Cypriot regulator has decided to fine the shareholders of suspended broker FXPulp, Said Salem and Shaher Hasanain, €150,000 and to refer the case to the office of the Attorney General for it to consider whether there was any criminal liability incurred.

The day after, CySEC also started a procedure to compensate the clients of FxPulp. The regulator has outlined that it will be publishing details about the process of recovering deposits from the Investor Compensation Fund (ICF) in Cyprus.

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Risky Business

On Wednesday, Ireland’s central bank reported that 75% of CFD traders incurred losses over the period of 2013 to 2014. The research involved 35,000 retail traders and found that besides the losses, which averaged €6,900 ($7,300), there were differences among service providers regarding the assessment of clients’ risk appetites.

Another finding was that most companies involved in the survey were compliant with legislative requirements concerning the handling of client complaints, although some were found to be lacking in the area of maintaining up-to-date records.

Ilan Tzorya’s New Venture

On Thursday we reported that the serial entrepreneur behind Tradologic is transitioning to the online content monetization field. The need for the technology offered by AdsTech Solutions probably occurred to Tzorya while trying to figure out ways to place video ads for binary options in an attractive way.

The new firm says that its service promises to help online video producers earn money for their views and enable advertisers to promote their brand directly into video clips but without ruining the viewer experience.

The Day CySEC Got Serious

On Friday, the financial markets watchdog of Cyprus went on a spree of regulatory announcements, revealing unusually harsh actions taken over the past two months. In the first and most eagerly awaited company announcement for clients, CySEC has settled with IronFX Global Ltd for a payment of €335,000.

Other firms fined by the regulator included the binary options operator of EZ Trader, which received the biggest penalty – €340,000. The firm behind several binary options brands like Interactive Option, HelloBrokers and MTXPlus have been slapped with €300,000. The operator behind FXGM, Depaho has been fined €233,000, while Reliantco, the parent company behind UFX Markets, was issued a €123,000 fine by CySEC.

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