Finance Magnates met Demetra Kalogerou for a special interview, discussing the IronFX story that shook the industry.
Demetra Kalogerou, the Chairman of the Cyprus Securities Exchange Commission (CySEC), is one of the most prominent and influential figures in the global financial regulations landscape.
Finance Magnates managed to sit down with her for a special and exclusive interview in light of the ongoing IronFx scandal that is far from being resolved.
We are following IronFX's misbehavior and your response to it. There are claims that the investigation has been delayed. What is your response?
“We actively respond to indications of potential misconduct or failure to full comply. In this case, we started getting investor complaints in February 2015 and started our investigation shortly after. It’s a big firm with hundreds of thousands of clients and all complaints received had to follow the process in place. The case took some time to complete due to its scale. It takes time to properly scrutinize any potential wrongdoing.”
You recently reached a settlement with IronFX. Why settle for 335,000 EUR when it's not enough to compensate its clients?
“The amount of a settlement isn’t directly or indirectly linked to the amount potentially needed for compensation. CySEC does not have any restitution powers over compensation of investors. Those who seek compensation have the right to go to the financial ombudsman or the courts. CySEC has issued a Circular which explains the procedure in place for investor complains which is available on its website. Our mandate is to supervise and CySEC will continue to closely supervise all CIFs under its supervision and will not hesitate to bring further enforcement forward in the event that the law is breached.”
We are an independent authority that works under the rule of law and not the political administration
Some claim that it is not nearly proportionate to the company's misbehavior.
“This settlement amount was the second highest that CySEC agreed to with a CIF. Generally, when a settlement is reached by CySEC, it indirectly implies that the firm accepts misbehavior. And having to immediately pay the amount is certainly a form of punishment. The primary issue was that the company’s Risk Management failed to identify potential misuse of its bonus system. We took this matter very seriously as managing risk is what underpins any financial organisation. The bonus practices prompted CySEC to issue a Circular in April 2015, which effectively sets a road map of the accepted market practices in terms of trading benefits. It's important to note that, in addition to the settlement amount, CySEC has imposed a list of corrective measures to be implemented by the company, as well as some restrictions on the company's activity.”
What are your comments on the allegations that IronFX’s ties with the President of Cyprus have helped? Did the president pressure you?
“We are an independent authority that works under the rule of law and not the political administration. Therefore, I don't have anything to say about that.”
You recently launched the Investor Compensation Fund (ICF): It currently holds around €17.5 million. What steps will CySEC take in the case a regulated broker goes bankrupt andis this amount is insufficient to compensate clients?
“The creation of the CIF Investor Compensation Fund (ICF) emanates from our mandate to protect the investors. Having this in mind and the risks in the market, we took the decision to review the regulation of the ICF. This process is currently underway. CySEC will hire an external advisor mandated to assess the ICF regulation. The aim is to ensure the ICF reflects the needs of the industry and its clientele and the prevailing risks. Our goal is to have this completed by the end of the year. We are considering various amendments, for example, whether the high risk firms might need to have a higher contribution to the fund in comparison to the ones with lower risks, i.e. the fees will depend on the risk profile.”
How does CySEC evaluate the conditions under which clients are entitled to compensation? What are your guidelines?
“A special committee is set to examine the applications of CIF clients towards the ICF and to assess the amount of compensation that each investor is entitled to. Having said that, it's important to underline that the activation of the ICF is the last resort. The ICF cannot be activated unless the CySEC revokes a CIF’s license, the CIF commits bankruptcy, and it is not in position to cover its outstanding obligations vis-à-vis its clients after the liquidation of its assets.”
This is the first part of the special interview with the head of CYSEC. The second part will be published later this week. The full interview, that includes many other hot topics, can be found in the new issue of the Quarterly Industry Report. To get the Q1 2016 report, please send an email to qir@financemagnates.com
Demetra Kalogerou, the Chairman of the Cyprus Securities Exchange Commission (CySEC), is one of the most prominent and influential figures in the global financial regulations landscape.
Finance Magnates managed to sit down with her for a special and exclusive interview in light of the ongoing IronFx scandal that is far from being resolved.
We are following IronFX's misbehavior and your response to it. There are claims that the investigation has been delayed. What is your response?
“We actively respond to indications of potential misconduct or failure to full comply. In this case, we started getting investor complaints in February 2015 and started our investigation shortly after. It’s a big firm with hundreds of thousands of clients and all complaints received had to follow the process in place. The case took some time to complete due to its scale. It takes time to properly scrutinize any potential wrongdoing.”
You recently reached a settlement with IronFX. Why settle for 335,000 EUR when it's not enough to compensate its clients?
“The amount of a settlement isn’t directly or indirectly linked to the amount potentially needed for compensation. CySEC does not have any restitution powers over compensation of investors. Those who seek compensation have the right to go to the financial ombudsman or the courts. CySEC has issued a Circular which explains the procedure in place for investor complains which is available on its website. Our mandate is to supervise and CySEC will continue to closely supervise all CIFs under its supervision and will not hesitate to bring further enforcement forward in the event that the law is breached.”
We are an independent authority that works under the rule of law and not the political administration
Some claim that it is not nearly proportionate to the company's misbehavior.
“This settlement amount was the second highest that CySEC agreed to with a CIF. Generally, when a settlement is reached by CySEC, it indirectly implies that the firm accepts misbehavior. And having to immediately pay the amount is certainly a form of punishment. The primary issue was that the company’s Risk Management failed to identify potential misuse of its bonus system. We took this matter very seriously as managing risk is what underpins any financial organisation. The bonus practices prompted CySEC to issue a Circular in April 2015, which effectively sets a road map of the accepted market practices in terms of trading benefits. It's important to note that, in addition to the settlement amount, CySEC has imposed a list of corrective measures to be implemented by the company, as well as some restrictions on the company's activity.”
What are your comments on the allegations that IronFX’s ties with the President of Cyprus have helped? Did the president pressure you?
“We are an independent authority that works under the rule of law and not the political administration. Therefore, I don't have anything to say about that.”
You recently launched the Investor Compensation Fund (ICF): It currently holds around €17.5 million. What steps will CySEC take in the case a regulated broker goes bankrupt andis this amount is insufficient to compensate clients?
“The creation of the CIF Investor Compensation Fund (ICF) emanates from our mandate to protect the investors. Having this in mind and the risks in the market, we took the decision to review the regulation of the ICF. This process is currently underway. CySEC will hire an external advisor mandated to assess the ICF regulation. The aim is to ensure the ICF reflects the needs of the industry and its clientele and the prevailing risks. Our goal is to have this completed by the end of the year. We are considering various amendments, for example, whether the high risk firms might need to have a higher contribution to the fund in comparison to the ones with lower risks, i.e. the fees will depend on the risk profile.”
How does CySEC evaluate the conditions under which clients are entitled to compensation? What are your guidelines?
“A special committee is set to examine the applications of CIF clients towards the ICF and to assess the amount of compensation that each investor is entitled to. Having said that, it's important to underline that the activation of the ICF is the last resort. The ICF cannot be activated unless the CySEC revokes a CIF’s license, the CIF commits bankruptcy, and it is not in position to cover its outstanding obligations vis-à-vis its clients after the liquidation of its assets.”
This is the first part of the special interview with the head of CYSEC. The second part will be published later this week. The full interview, that includes many other hot topics, can be found in the new issue of the Quarterly Industry Report. To get the Q1 2016 report, please send an email to qir@financemagnates.com
7% Daily Profit? Regulator Warns of Potential Scam
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
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#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
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Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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