CySEC: List of public warnings effectively fights cheaters

Cypriot financial regulator CySEC has issued a report on the effects of listing illegal companies on the public alert list. According to the regulator's statistics, over 75% of entities that landed on the "black list" shortly afterwards ceased their activities. On the pages of the Forex Club portal, you can monitor new entries on the aforementioned lists of financial supervisors from all over Europe.

Check it out: Warning List

The black list is the black end

CySEC regularly places entities that operate illegally in its register - they do not have the required permits, mislead potential customers or impersonate companies operating in accordance with the law (so-called clones). Thanks to this, investors can better distinguish whether using the services of a given broker is safe.

At the moment, the list of warnings of the Cypriot regulator includes over 100 entities that have been classified as a potential threat. As it turns out, out of 139 websites, 106 are no longer operational (76%). This type of news spreads relatively quickly, which effectively kills the marketing opportunities of a given brand, and thus effective customer acquisition.

Brokers turn out to be a problem, as they do not do anything on the list themselves and continue to do business without the required permits, or stubbornly claim that they provide services legally. This is possible thanks to the registration of business under the jurisdiction of exotic islands and tax havens, such as the Marshall Islands, Belize, Vanuatu and others.

In such situations, European regulators often have very limited room for maneuver because they are not able to impose a severe financial penalty on the company or effectively enforce it. Then the only method that, according to statistics, is quite effective, is to disseminate information about the illegal activity of a given entity.