CySEC Suspends Prior Capital CY, Awards TECFININE Latest CIF License

Prior Capital's former brand, PriorFx Ltd, was previously fined €64,000 in 2017 over violations related to marketing material

The Cyprus Financial regulator CySEC handed down a suspension on the Cyprus Investment Firm (CIF) license of Prior Capital CY Ltd (formerly PriorFx Ltd), according to a decision being made at the regulator’s last meeting.

Prior Capital had its license temporarily suspended after the CySEC raised concerns over practices by the company, as well as its management that the watchdog deemed potentially not compliant with regulatory standards.

In particular, the broker was flagged for non-compliance with section 22(1) of the Cypriot regulation as well as authorization conditions stated in section 17(9) of the Law, which mainly concerns organizational requirements and the security of clients’ funds. Of note, the company’s business model is seemingly orientated to institutional clients such as hedge funds, small brokers, professional pools of investors.

Prior Capital CY Ltd’s former brand, PriorFx Ltd, was previously fined €64,000 in 2017 over violations related to the compliance of its marketing material with the regulatory obligations. Although the CySEC at this time didn’t provide a breakdown or specific details for the regulatory fines, similar decisions often referenced lacking internal manual or records to assess how compliant are the broker’s marketing materials.

Prior Capital CY is obliged to take action within 20 days to comply with the necessary provisions then apply to reactivate their license once more. But while the license suspension is in force, the company is not permitted to enter into a business relationship with any person, accept any new customers, or provide any services.

In addition, Prior Capital must close any open positions, return funds and profits earned, if and when their clients submit requests for any of these purposes. In the meantime, the company has to upload notices regarding the suspension of its license onto all of its sites, though the company has yet to comply.

Finally, if the broker ultimately fails to fix the compliance issues set forth by CySEC, the regulator could trigger procedures for the revocation of its authorizations.

A new broker steps in

The recent series of fines and suspensions made by the Cypriot regulator, all aimed to tighten online trading regulation, raise on everyone’s mind the question of whether or not Cyprus remains an attractive destination for retail brokers.

However, it seems that CySEC’s efforts were not that bad since we have just found out that at least one broker out there is brave enough to expand its business to Cyprus. As we have just learned from a CySEC announcement, a broker called TEC International (Cyprus) Limited has recently licensed its retail forex brand TECFININE which has already been granted a CIF license on January 27, 2020.

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Unfortunately, the regulatory filing clears up a few details about the FX and CFDs broker that started its operation late in 2019. TECFININE has only a single executive listed on Linkedin, called Gina Guo, who assumes a dual role as its executive director and sales manager at Singapore-based sourcing & compounding firm, called APOSTAR.

Gina Guo
Gina Guo

TECFININE haven’t updated its regulatory details yet, but based on CySEC’s filing it was granted the following details:

License Number: 382/20

License Date: 27/01/2020

Company Registration Number: 389575

Investment Services

Reception and transmission of orders in relation to one or more financial instruments:

Execution of orders on behalf of clients

Ancillary Services

Safekeeping and administration of financial instruments, including custodianship and related services:

Foreign exchange services where these are connected to the provision of investment services:

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