Forex broker with a license from Vanuatu on the list of KNF warnings

MIB 700, administered by Blue Seal Limited, based in the Republic of Vanuatu, has been included in the Financial Supervision Authority's list of warnings. The reason why this Forex broker landed on the "black list" is to operate in Poland without the required registration. This is tantamount to notification of a suspicion of committing a crime under Art. 178 of the Act on Trading in Financial Instruments (conducting brokerage activities without the permission of the Polish Financial Supervision Authority).

This is another foreign entity from the currency trading industry, which went to an infamous group. The full list is available on the KNF website pod tym linkiem.

The 700 MIB offer

At first glance, there are no disturbing signals on the broker's website. The site is relatively simple and clear, and the offer is based on the popular MetaTrader 5 platform. Maximum leverage is 1: 300 and contact details lead to Belfast, UK. There is also a Polish language version of the website (and in 16 other languages) with a translation of the correct quality (it is not a Google Translator), which suggests that the company actually directed its services, among others to Polish residents. Nevertheless, it does not appear in the KNF register.

Brokers, in order to act in accordance with the law, conduct marketing activities and take residents from EU countries, including Poland, must receive so-called notification of licenses to local regulators.

Almost 500 brokers from Vanuatu

The Republic of Vanuatu consists of 83 islands located in Oceania. According to data on 2009, the number of residents does not exceed 1 / 4 million. The economy is based primarily on services - it is called tax haven. And this can be considered the main reason why more and more brokers are choosing Vanuatu as a place to register their activities. Additionally, it is estimated that only 2-3 months must be waiting for brokers to receive licenses (currently in Cyprus it is around 12 months), and to set up this type of business all you need is just 2 000 USD (source: Finance Magnates).

At the moment, the Forex license from Vanuatu has 487 brokers (full list here). This gives us an average of 500 residents per one company. VFSC, which is the regulatory institution there, guarantees a customer deposit up to the amount of 20 000 EUR, however, no credible cases are known that would show the efficiency of this mechanism.