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The owner of the UFX.com brand is penalized for 95 000 EUR by CySEC

The owner of the UFX.com brand is penalized for 95 000 EUR by CySEC

created Paweł MosionekDecember 21, 2017

The Cyprus Securities and Exchange Commission (CySEC) announced that it has imposed an administrative fine on Reliantco Investments Ltd., the investment firm that manages the UFX.com brand.

95 000 EUR for numerous shortcomings

A fine was imposed on the Cypriot broker on almost 100 thousand. euro. Reason? The company has violated many of the policies and procedures required by CySEC to ensure full investor protection. The penalty consists of three parts:

  1. 40 000 EUR - in the event of non-compliance with Art. 36 sec. 1 of the Act on Investment Services and Regulated Regulated Markets of 2007, because the Company did not act honestly and professionally with regard to offering services to clients;
  2. EUR 40 - for non-compliance with article 000 (36) (a) of the Act and paragraph 1, paragraphs (6) and (2) of Directive DI 8-144-2007 of 02 of the Securities and Exchange Commission for the professional competence of investment firms and natural persons employed by them, due to the lack of accurate, clear and not misleading advertising materials for clients;
  3. EUR 15 - for non-compliance with article 000 (36) (d) of the Act and paragraphs 1 and 15 of Directive DI 16-144-2007 of 02 of the Securities and Exchange Commission regarding the professional competences of investment firms and natural persons employed by them, because the Company does not obtained all necessary and complete information to ensure that client suitability checks constitute the authorization of the appropriate investment services for each client.

The whole situation is commented on by UFX.com managing director, Dennis De Jong:

“The fine imposed today was for things in the past. As stated in the decision, a further follow-up audit showed that significant progress has been made in line with the CySEC recommendations. Moreover, the Commission wrote that "CySEC was responsible for the company's remedial actions implemented under CySEC's jurisdiction, including streamlining customer entry processes and changing the field of advertising and risk alerts." We are pleased that we have already introduced features to improve risk input and mitigation, and we will act in accordance with the best interests of our customers. "

CySEC: Zero tolerance

CySEC's supervisory actions are consistent with similar penalties imposed on the Company in 2015 in connection with similar weaknesses detected at that time. A further follow-up audit to ensure full compliance with CySEC rules to protect investors showed that, despite significant progress made under the CySEC recommendations, there were still significant compliance deficiencies that contributed to the risk for consumers.

By limiting the penalty payment, CySEC took into account the company's corrective actions implemented in accordance with the CySEC jurisdiction, including streamlining client deployment processes and changing warnings about advertising and risk.

Demetra Kalogerou, chairwoman of CySEC, said:

The company did not meet the standards set by the applicable regulations aimed at protecting investors. The fine imposed on the Company for failing to meet its obligations in the best interest of its clients stems from CySEC's initial supervisory proceedings towards Reliantco. The fine is not a final action for investment companies regulated in Cyprus, and CySEC will not hesitate to use all available supervisory tools to limit harm to consumers.

Adrea Iniesta and UFX

The brokered broker has been present on the market since the 2010 year and since that year has been a Cypriot brokerage house license. It also has notification of the Polish Financial Supervision Authority. The offer is complex, although based on the popular MT4 platform, and trading on the basic Micro account can be started with a deposit from 100 $. However, on this type of accounts the spread on EUR / USD is up to 4.0 pips, which nowadays seems to be an abstract value. The spread of the 2.0 pips will be obtained only at the Gold account with min. 5000 $ deposit.

The world-famous footballer Andrés Iniesta became the international ambassador of the UFX brand in July this year. The initial contract was signed for 2 years with the possibility of extension to 3.

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About the Author
Paweł Mosionek
An active trader on the Forex market since 2006. Editor of the Forex Nawigator portal and editor-in-chief and co-creator of the ForexClub.pl website. Speaker at the "Focus on Forex" conference at the Warsaw School of Economics, "NetVision" at the Gdańsk University of Technology and "Financial Intelligence" at the University of Gdańsk. Twice winner of "Junior Trader" - investment game for students organized by DM XTB. Addicted to travel, motorbikes and parachuting.

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