The Kanto finance bureau of Japan’s Ministry of Finance (MoF) on Monday reminded the public to exercise caution when dealing with affiliates or introducing brokers of unregulated FX companies. In an advisory, the MOF warned the public against CLUB THE ZIPANGU, which operates an IB business although it is unauthorized to solicit investments from the public.
The watchdog said both types of operators, IB or execution brokers, should implement and maintain appropriate measures to ensure compliance with all applicable rules and regulations.
The MOF explained that CLUB THE ZIPANGU, headed by Yasuhiko Tanaka, asked its clients to open an account with overseas dealers that the authority has warned against before. This includes well-known brands such as FXDD Trading, Axiory Global Ltd, and Titan FX Limited.
Amid Ongoing Uncertainty, Is the Crypto Industry Stepping Up? Go to article >>
The firms on Kanto’s list may have regulation in other jurisdictions, but this is not sufficient as no such passports are recognized, and firms need to also obtain JFSA authorization to do business in Japan.
The firms cited have either made solicitations or offered services online in Japan and/or in Japanese, while not being permitted to do so. Japanese customers of these firms are not afforded the protections available to customers of firms properly licensed and regulated in the country.
The Japanese watchdog confirmed that registration under the Financial Instruments and Exchange Act is required in principle, even for overseas operators, for offering financial instruments for Japanese residents or for transacting with them as counterparties.
The agency noted that the information used in the warnings was obtained from solicitation materials, and therefore may be inaccurate. In addition, investors are able to check on the Japanese Financial Services Authority (JFSA) website to confirm if a company is registered and regulated in the country.