“Facing Difficulties”: CySEC Investigates CIF’ That Struggles with Client Funds Returns

<p>After the
Cypriot financial market regulator took initial action against Ayers Alliance
(previously known as Harborx Ltd.) in April 2022, the investment company's
problems continued. According to information released by the Cyprus Securities
and Exchange Commission (<a href="https://www.financemagnates.com/tag/cysec/" target="_blank" rel="follow">CySEC</a>), an investigation has been launched against the
company in connection with a potential violation of regulations. </p><p>Although
<a href="https://www.financemagnates.com/terms/c/cysec/">CySEC</a> did not provide any specifics in the recent call, it did mention that
financial penalties could be imposed once the investigation is concluded. In a
separate announcement, the regulated company says that paying out funds to all
customers could "face difficulties."</p><p>Cysec Launches
Investigation against Ayers</p><p>Ayers
Alliance Financial Group Ltd (Ayers Alliance) has been licensed by CySEC since
2014. The company recently announced that, due to circumstances beyond its
"immediate control," it is compelled to cease providing its
investment services and voluntarily wishes to relinquish its Cypriot Investment
Firm (<a href="https://www.financemagnates.com/tag/cif/" target="_blank" rel="follow">CIF</a>) license. As part of its licensed services, Ayers offered asset
management, structured products, and units in collective investments.</p><p>The
investigation initiated by CySEC is linked to this renunciation. While awaiting
the outcome of this application and the CySEC investigation, the CIF remains
under the regulator's supervision, which reminds it of the obligation to
continue adhering to applicable laws.</p><p>"CySEC
notes that Ayers Alliance Financial Group Ltd has appointed Mr. Panos Eliades
as Administrator to the Group. Administrators are generally appointed by the
Board of Directors of a company to investigate its business and financial
affairs. The regulator is not involved in this process," CySEC commented
in a statement.</p><p><a href="https://www.financemagnates.com/forex/brokers/cysec-takes-action-against-ayers-alliance-bcs-cyprus-for-non-compliance/" target="_blank" rel="follow">In April
2023</a>, CySEC imposed sanctions on Ayers Alliance for violating regulations
concerning safeguarding client assets, precisely depositing clients' financial
instruments with a third party. The regulator then ordered the company to cease
cooperation with the external firm responsible for maintaining client deposits
within six months.</p><p>Until 2018,
the company operated as Harborx Ltd. but was acquired by Ayers Alliance <a href="https://www.financemagnates.com/thought-leadership/harborx-ltd-acquired-by-ayers-alliance-financial-group/" target="_blank" rel="follow">in 2018</a>
from previous Hong Kong-based shareholders.</p><p>Ayers Faces Struggles to
Return Investors' Funds</p><p>In the
recent update, Ayers stated that the company wishes to return all funds to its
clients. However, it is "facing difficulties."</p><p>The company
stated it would not be carrying out any investment activities beyond those
strictly necessary for completing the pending transactions or those of its
clients and after communication with CySEC. All client funds and assets will be
returned to the best of the company's abilities.</p><p>"In
addition, we are taking legal action against those third parties we consider
responsible for the present position and our regulator CySEC is aware of
correspondence to that effect," the company commented in a statement about
its intention to renounce its license voluntarily.</p><p>The first
regulatory action against Ayers Alliance took place in April 2022. At that
time, CySEC announced that the company had violated mandatory staffing
requirements for its <a href="https://www.financemagnates.com/terms/r/risk-management/">risk management</a> department. The regulator ceased the
company from using personnel without the skills, knowledge, and expertise
required for the performance of the responsibilities of the Head of the Risk
Management Department.</p>

This article was written by Damian Chmiel at www.financemagnates.com.