The Financial Conduct Authority (FCA) today warned the public against a company named Yinforex Capital Limited which it says is a clone firm of an FCA-authorised company.
Clone firms imitate companies that hold a license, when actually they are not authorised. They cold call clients and give them misleading information to convince them to invest.
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In this case, Yinforex Capital Limited has been using the details of VIBHS Financial Limited. The FCA urges caution when clients receive calls from such companies.
A perusal of the website of the company shows that it is a Chinese firm and among other products, it offers high leverage to customers, allowing them to reduce their margin requirement. It has to be noted that as per FCA rules, brokers are not authorised to offer margins of less than 1 percent to their clients.
The FCA has been issuing warnings about such clone firms regularly over the last few months as a number of such companies have been appearing on its radar.
The FCA advises the public to always refer to the register on its website, which contains a list of authorised firms. The FCA has also requested that the public report clone firms so that the watchdog will be able to take the necessary actions.