Cyprus’s financial market regulator CySEC have just published a warning to the general public regarding Depaho FX. CySEC have sought to make it clear that Depaho FX does not carry a licence to provide investment and ancillary services within the European Union, with the firm never having received a licence nor authorisation to provide such services.
The Depaho FX website states that the firm is headquartered on the Island of Cyprus and lists the same address as the regulated Depaho Ltd. who do possess a full CySEC licence and who operate a number of brands including Depaho.eu and GTCM. The warning reiterates that GTCM’s licence is valid and emphasizes the importance of ensuring that firms operating under similar names are in fact the same company. Traders should make sure that they do proper due diligence before depositing funds with a brokerage to ensure they do not get pulled in by copycat firms.
A number of unregulated firms have adopted this tactic in the past as it allows them to attract clients who believe that they are trading with the regulated firm when they are in fact a customer of an unregulated entity. At the very minimum such behaviour is unprofessional and at worst it can be tantamount to outright fraud if the firm co-opts the address and name of the real regulated brokerage or brand. Depaho FX has no relationship with Depaho Ltd. but has used the regulated firms address and name throughout their website appearing in the footer of every page. The website however hints at Depaho FX being incorporated in Panama. As of today imposter firm Depaho FX is continuing to use Depaho Ltd’s name and address on the footer of every page of its website.
This is the second time within a week that CySEC has released a warning regarding the operation of unregulated firms within the jurisdiction and the European Union in general. Earlier in the week CySEC released a warning regarding 4XP (Forex Place Ltd.) with a ForexMagnates source stating that the brokerage had been cross promoted alongside regulated brands who are operated by the same mutual services provider.