CySEC Orders RoboMarkets to Stop Giving “Branded Merchandise” to Clients

<p>RoboMarkets,
a forex and contracts for difference (CFD) broker regulated by the Cyprus
Securities and Exchange Commission (CySEC), has been prohibited by the
securities regulator from offering non-monetary rewards such as race tickets
and “branded merchandise” to its
retail customers. CySEC announced the decision today (Wednesday), noting that
its Board reached the decision earlier in March.</p><p>CySEC Tackles Non-Monetary Rewards</p><p>According
to the Cypriot financial watchdog, RoboMarkets through its website and social
media platforms offered such non-monetary rewards to its customers. However, these
“activities” do not comply with the provisions of the European
Union’s Markets in Financial Instruments Regulation (MiFIR) on protecting
investors and the financial markets from harm, CySEC noted in <a href="https://www.cysec.gov.cy/en-GB/public-info/decisions/95212/?uuid=23082023135652">a statement</a>. </p><p>Furthermore,
the regulator claimed that RoboMarkets through the practice sought to
circumvent a section of the
European Securities and Markets Authority's (ESMA) directive on product
intervention. The intervention seeks to
protect investors against harm and prevent the destabilization
of the financial market.</p><p>It appears
that the Cypriot regulator sees RoboMarket’s offering of race tickets and
branded merchandise as a technique to entice customers to trade CFDs. The
derivative instruments, which allow investors to bet on the future price of an
underlying asset, such as a stock or currency, are considered highly
risky. </p><p>As of press
time, RoboMarkets has not responded to <a href="https://www.financemagnates.com/" target="_blank" rel="follow">Finance Magnates</a>’ request for a comment
on the order.</p><p>CySEC
Maintains Watch over Cyprus’ Financial Markets</p><p>Meanwhile, CySEC
in recent months also issued several other regulatory orders affecting forex brokers in the jurisdiction. Last month, it slammed a fine of €100,000 and €50,000 on <a href="https://www.financemagnates.com/forex/brokers/cysec-slaps-100k-fine-on-bdswiss-for-non-compliance/" target="_blank" rel="follow">BDSwiss</a> and <a href="https://www.financemagnates.com/forex/freedom-finance-pays-50k-to-cysec-over-potential-aml-non-compliance/" target="_blank" rel="follow">Freedom Finance</a>. In
addition, the regulator reached a €100,000 settlement with BrokerCreditService (BCS) Cyprus to resolve the institutional
broker and investment firm’s “possible violations” of the EU’s market
abuse laws and Cyprus’ market rules.</p><p>Earlier in
May, CySEC announced <a href="https://www.financemagnates.com/forex/cysec-to-conduct-site-visits-of-retail-brokers/" target="_blank" rel="follow">plans to conduct on-site
visits</a> and
desk-based reviews of regulated companies offering investment services to
retail clients in the island country. The Commission noted that
the visits will be conducted on a sample of Cyprus Investment Firms (CIFs)
during the second half of this year.</p><p>“This
action will allow CySEC to assess how the CIFs apply the MiFID II requirements
on marketing communications, and it will also enhance the protection of
investors in line with ESMA's objectives," CySEC explained.</p><p>MetaQuotes caps product activation; Swissquote's portfolios; <a href="https://www.financemagnates.com/forex/news-nuggets-23-august-metaquotes-caps-product-activation-swissquotes-portfolios/" target="_blank" rel="follow">read today's news nuggets</a>. </p>

This article was written by Solomon Oladipupo at www.financemagnates.com.