Capital Option and Sky FX parent has its license stripped by CySEC

Some market participants as well as other stakeholders, such as certain regulators for example France’s AMF have often voiced their criticism again the level and adequacy of the supervision exerted by the Cyprus Securities and Exchange Commission over the entities it regulates, not least because those obtaining a license from the Cypriot pertinent body can then move on to “passport” their operations in the entire EU area. In fact, the AMF has been known to been exerting its influence on the European Securities Markets Authority (ESMA) to pressure the Cypriot regulator into more vigilantly supervising its regulated entities.

It is a fact that lately, and especially since the latter part of last year, CySEC has indeed been taking tangible measures in terms of tightening its controls over the CIFs it supervises and coming across as a much stricter watchdog than in the past. The most recent example of this the announcement that was publicized by CySEC on 27 May, though which it makes public its Board decision taken on 25 April, to wholly withdraw the Cyprus Investment Firm authorization with number 151/11 of investment firm «Trademarker (Cyprus) Ltd», which is the parent company behind retail Forex brokerage SKYFX (www.skyfx.com) and Binary Options brokerage Capital Option (www.capitaloption.com).

The decision comes following a suspension of the CIF’s license which has been in place since March of this year. In its announcement, CySEC explains that the reasons for the withdrawal of the license lie in the company’s owner, since he is deemed not to be of sufficient good repute and not suitable to ensure the sound and prudent management of the Company, especially in view of the fact that “the Court in Israel has appointed a liquidator for the companies owned by Mr Aviv Tal Mor due to his possible involvement in illegal acts relating to the financial sector.”

CySEC also points out that Trademarker does not ensure continuity and regularity in the execution of client’s orders due to its market maker’ s voluntary licence suspension. In practical terms, the regulator’s decision to terminate the license of the firm means that the company should immediately cease to provide investment and ancillary services and settle, within a period of three months, all its obligations arising from the services that are no longer allowed to perform.

More specifically, CySEC says that the Company should, immediately and within the three month period at the latest, return to all of its clients any money owed, in accordance with the procedures adopted for this purpose, and within the same period also examine and solve all complaints before it.

 

CySEC also notes that it considers the money claimed by the complainants as clients’ money and consequently highlights that the Company should ensure that this is kept in a separate bank account until all complains are investigated. Finally, CySEC said in its announcement that it has called the company to remove all information from its websites stating that it is CySEC-regulated and instead to place a public announcement informing investors of the license withdrawal.

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George Milios

George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.

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