EuropeFX - PLN 1,657 million fine for a Cyprus broker

370 thousand Euro penalties will be paid by the Maxiflex broker from Cyprus for violations of the regulations established by the regulator from this country - CySEC. This is the result of an agreement between these entities after detecting irregularities in September 2020. Earlier, the same company lost its license in the British Isles, but it did not teach it much, or it just pays off to pay fines anyway, because it earns much more on it.

The agreement was reached very quickly, so without much risk it can be assumed that the punished company was well aware of its offenses. It is hard to expect that someone would easily swallow a fine of 370. EUR (approx. PLN 1,657 million) if the matter was debatable, or there was even a shadow of a chance not only to avoid it, but at least to reduce the amount of the fine imposed by the supervisory authority.

A series of violations for almost two years

Interestingly, the licensed brokerage group FX Maxiflex Ltd. received a fine for "Possible violations"so no one had to prove them - neither at this stage, nor even later during the trial in court. They were to take place in the period from January 2019 to September 2020. 

Each licensed CySEC entity must comply with organizational requirements relating to conflicts of interest, customer information, risk assessment and the adequacy of instruments to the knowledge of its clients, as well as reporting and executing orders on terms most favorable to the client. Which of the above guidelines and how many times has he broken? We will not find out for now, because this is what the settlement is about - the parties do not inform what exactly was agreed and how much damage it caused to retail clients. 

The British were ruthless

These are not the company's first problems. Maxiflex (operating mainly through the EuropeFX retail forex broker brand on europefx.com) was one of the three licensed CySEC brokers which in June British regulator FCA received permission to sell contracts for exchange rate differences (CFD) to UK consumers.