The Cypriot financial market regulator has today (Monday) announced a €150,000 settlement with L.F. Investment, the operator of the contracts for differences (CFDs) broker Purple Trading, for “possible violations” of several regulatory requirements. The company has already paid the settlement amount.
CySEC’s Assessment of the Broker
The Cyprus Securities and Exchange Commission (CySEC) notice detailed that the settlement was reached after the regulator assessed the broker’s compliance from July 2021 until the start of October 2023.
More from Cyprus: CySEC Withdraws Itrade Global’s Licence 2 Years After It Shut Down CFDs Broker
According to the regulator, there were possible lapses around the company’s organisational requirements under the CySEC licence. Furthermore, there was a possibility of a conflict of interest between the broker and its clients. The broker also possibly failed regarding the general principles and information addressed to clients.
Another possible lapse was around the broker’s obligations regarding the appointment of tied agents. There were also questions over the broker’s compliance with restrictions on the marketing, distribution, and sale of CFDs to retail clients.
“CySEC… has the power to reach a settlement for any violation or possible violation, act or omission for which there is reasonable ground to believe that it took place in violation of the provisions of CySEC’s supervised legislation,” the notice by CySEC added.
FinanceMagnates.com approached Purple Trading for its take on the settlement but has not received any response as of press time.
Only European Clients
The Purple Trading brand operates in Europe under a Cyprus licence. Its website mentions that the Cypriot entity “cannot and will not accept clients from outside the European Economic Area and from Belgium, Switzerland, and the USA.”
However, the broker brand also operates outside Europe under an entity licensed in Seychelles. The Seychelles entity even backs a prop trading brand, Fintokei, which is based in the Czech Republic. Interestingly, Fintokei started by offering prop trading services in Japan and then began to capture other markets.
The Cypriot financial market regulator has today (Monday) announced a €150,000 settlement with L.F. Investment, the operator of the contracts for differences (CFDs) broker Purple Trading, for “possible violations” of several regulatory requirements. The company has already paid the settlement amount.
CySEC’s Assessment of the Broker
The Cyprus Securities and Exchange Commission (CySEC) notice detailed that the settlement was reached after the regulator assessed the broker’s compliance from July 2021 until the start of October 2023.
More from Cyprus: CySEC Withdraws Itrade Global’s Licence 2 Years After It Shut Down CFDs Broker
According to the regulator, there were possible lapses around the company’s organisational requirements under the CySEC licence. Furthermore, there was a possibility of a conflict of interest between the broker and its clients. The broker also possibly failed regarding the general principles and information addressed to clients.
Another possible lapse was around the broker’s obligations regarding the appointment of tied agents. There were also questions over the broker’s compliance with restrictions on the marketing, distribution, and sale of CFDs to retail clients.
“CySEC… has the power to reach a settlement for any violation or possible violation, act or omission for which there is reasonable ground to believe that it took place in violation of the provisions of CySEC’s supervised legislation,” the notice by CySEC added.
FinanceMagnates.com approached Purple Trading for its take on the settlement but has not received any response as of press time.
Only European Clients
The Purple Trading brand operates in Europe under a Cyprus licence. Its website mentions that the Cypriot entity “cannot and will not accept clients from outside the European Economic Area and from Belgium, Switzerland, and the USA.”
However, the broker brand also operates outside Europe under an entity licensed in Seychelles. The Seychelles entity even backs a prop trading brand, Fintokei, which is based in the Czech Republic. Interestingly, Fintokei started by offering prop trading services in Japan and then began to capture other markets.
This post is originally published on FINANCEMAGNATES.
