The British Columbia Securities Commission (BCSC), one of the thirteen provincial financial regulators in Canada, has added XFR Financial Ltd. to its growing ‘Investment Caution List’, according to a BCSC statement.
According to the Canadian provincial regulator, a representative of XForex solicited a British Columbia (BC) resident and the company opened a trading account for him, without being authorised to do so. The BCSC has therefore urged investors to use caution when dealing with this company.
XFR Financial Limited owns the CFD and forex providers XForex ad XTrade, which are registered with the Cyprus Securities and Exchange Commission (CySEC). Earlier in May, XF Financial Limited has decided to consolidate its offering and phase out the older brand, XForex, and now officially operates under Xtrade Europe.
Although it is a regular warning, the aforementioned rebranding makes this regulatory action noteworthy, as XForex no longer exists. And while it could be seen as a reminder that such investigations often take some time, and that the BCSC is not afraid of looking back in time to find violations, the regulator should have touched this point, particularly as it mentioned the website link of XForex which disappeared from the web several months ago.
Finance Magnates contacted Xtrade for more information on the matter, and at the time of publication we got the following response from Tara Mor, Vice President Business Development and Compliance of XFR Group: “XForex in the past was owned and operated by XFR Financial Ltd. The brand was completely shut down and removed from the Web more than a year ago.”
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“During XForex’s operation, XFR Financial Ltd. never accepted any clients from Canada, particularly British Colombia. Our processors that we worked with had blocked those BINs (credit cards) from being able to make a deposit. We are very surprised by this news, since XForex had been taking down in its entirety and its URL does not exist. Currently, the XForex URL redirects to Xtrade. Anyone coming from an IP address within Canada will receive an error message, as the page is non-existent,” he added.
In addition to CySEC’s regulation, Xtrade also holds a license from the Belize’ IFSC, as Xtrade.BLZ, and a licence from the Australian watchdog ASIC. However, the three brands have never been registered to trade in, or advise on, securities or exchange contracts in British Columbia. For this reason, BCSC has included them in its list of individuals and companies that appear to be engaging in activities that may pose a risk to investors.
This is not the first time that one of XFR Financial’s brands has been flagged. In November 2015, Finance Magnates reported that the Australia’s financial regulator, ASIC, fined XForex USD 30,600 in penalties for misleading online advertising and contravening consumer protection laws.
The BCSC is the independent provincial government agency responsible for regulating securities trading in British Columbia through the administration of the Securities Act. The regulator website provides information, tools and resources for investors, including investor warnings about individuals and companies that appear to be engaging in unauthorized activities.
The warning follows a similar case highlighted by the BCSC this month in which the binary options broker DGI Market was added to its list of companies not to do business with.