Yesterday CySEC made the move to fine Cypriot Investment firm, Trading Point of Financial Instruments Ltd. an administrative fine of 10,000 Euros. A fine of 5,000 euros was issued for a transgression of Article 18 of Cyprus’s 2007 Investment Services, Activities and Regulated Markets Law and an additional infringement of CySEC directive DI144-2007-o1. A further fine of 5,000 Euros was issued in regards to the firm breaching articles 58, 60 and 61 of the 2007 law, relating to proper money laundering procedures.
The offences that Trading Point Ltd. better known as xemarkets, relate to a failure to comply with certain legal requirements, CySEC authorized IF (Investment Firms) are required to make certain provisions to protect and indemnify client funds whilst they remain in the custody of the firm. In addition to these failings CySEC also noted that there were some irregularities when it came to the firms Anti-Money Laundering procedures.
This is not the first time that Trading Point Ltd. have fallen foul of financial regulators. Back in May 2012, Trading Point was issued with $140,000 fine by the CTFC for accepting US customers without the proper US financial regulatory backing. It was alleged by the CTFC that Trading Point Ltd. had accepted deposits from US customers in both 2010 and 2011, with Trading Point being one of the 24 firms to catch the eye of the US regulators at the time.
The 10,000 Euro fine issued by CySEC on Friday, is the first time that the firm has had troubles with European regulators since the companies launch back in 2009. Trading Point are not the first firm to have received disciplinary action from financial regulators, with similar regulatory breaches occurring recently at UK regulated XCapital and at City Index’s Australian branch.
The 5,00o Euro fined issued by CySEC is relatively small in comparison to some of the fines issued by the regulator earlier this year, when Reliantco (better known as UFX Markets) was fined 100,000 Euros and eToro was fined a total 50,000 Euros.
It is noted in the CySEC announcement that Trading Point’s previous clean regulatory record acted as a mitigating factor in regards to the fine issued by the regulator. Currently the document regarding Trading Point of Financial Instruments Ltd. transgressions is only available in Greek.