The Cyprus Securities and Exchange Commission (CySEC) has warned investors regarding several unlicensed websites promoting investment services. This is already the third enforcement action taken by the regulator this month.
CySEC Exposes Unlicensed Investment Websites
According to the CySEC announcement, the following 12 websites do not belong to authorized entities licensed to provide investment services in Cyprus: cryplanet.com, brokeroneltd.com, nexotrades.com, illuxor.net, marketsac.com, ufxone.com, finquotesfinancial.work, globaldibs.com, successfulmarktplatform.com, canolimited.com, royalfxbank.com and tradeoptfx.com.
CySEC urged investors to verify licenses on their official website before conducting business with any investment firm. Licensed entities in Cyprus are authorized under Article 5 of Law 87(I)/2017.
The regulator periodically warns consumers of unregulated websites falsely claiming to offer investment services. Investors dealing with unlicensed firms have no recourse under Cypriot regulations and are at risk of fraud. CySEC is inviting investors to report any suspicious investment activities not listed on their registry. Consumers can consult the CySEC website for a complete list of authorized investment firms in Cyprus.
Why Traders Should Avoid Unregulated Firms
There are several crucial reasons why traders should avoid using investment services from entities not regulated by CySEC or other prominent financial market watchdogs. Firstly, unregulated firms do not have to abide by the rules and regulations that serve to protect investors. Without oversight from a regulator like CySEC , traders have no recourse or means of compensation when an unregulated broker mishandles investor money or goes bankrupt.
Furthermore, analysis of unregulated offshore brokers shows a substantially higher risk of scams, loss of deposits, and other predatory behavior towards traders and investors. This stems from the fact that such brokers largely answer only to themselves without accountability standards enforced by regulating bodies.
Additionally, entities not regulated by CySEC cannot legally provide investment services under Article 5 of Law 87(I)/2017 in Cyprus. CySEC routinely warns consumers of unlicensed entities falsely claiming to offer trading and investment services. Without licenses from oversight bodies like CySEC, such unregulated brokers operate illicitly while putting trader investments and funds in jeopardy.
CySEC Active at Year-End
As Finance Magnates reported nearly two weeks ago, the Cypriot regulator imposed financial penalties on several investment firms. Firstly, on 7th December, it fined Egard Management Ltd, Enter Winglobe Management Ltd, and Apollo (Cyprus) Limited.
Earlier, a penalty of €90,000 was imposed on the regulated firm Titanedge Securities Ltd, which operates multiple CFDs brokerage brands, including TradeEU.com and Titan Edge. The settlement was reached with the Cyprus Investment Firm (CIF) license holder "for possible violations of The Investment Services and Activities and Regulated Markets Law of 2017."
During the same period, the regulator published its Annual Statistical Bulletin for 2022, highlighting an overview of Cyprus' financial landscape. Despite a slowdown in the global economy, the market for regulated entities showed resilience. The number of regulated entities controlled by CySEC, additionally increased 4%.
