CySEC fines CIF Novox Capital Ltd €175,000 for violating regulatory service rules. CIF company operates Binary Options, Forex and CFDs brokerage brands. What do we know?
The Cyprus Securities and Exchange Commission (CySEC) has issued a €175,000 fine to the licensed Cyprus Investment Firm (CIF), namely Novox Capital Ltd.
CySEC fines CIF Novox Capital Ltd €175,000
The announcement from the Cypriot regulator about the fine for Novox Capital Ltd. €175,000 emerged just yesterday. Specifically, the CIF company operates Binary Options, Forex and CFDs brokerage brands in Cyprus. These include OptionBit (at website optionbit.eu), ZoomTrader Global (at zoomtraderglobal.com), RoyalPip (at royalpip.com), and NGN Broker (at ngnbroker.com).
As it is mentioned above, the fine totals at €175,000, where €70,000 comes for providing investment advice without authorization. The remaining part of the fine is imposed for the following violations:
€10,000 for not maintaining proper internal control mechanisms for the approval of advertising materials.
€20,000 for inadequate outsourcing of activities to third parties, such as customer service and call center activities.
€30,000 for not acting in the best interests of the clients.
€30,000 for the dissemination of misleading advertising materials by third parties.
€15,000 for providing information that is not suitable for clients.
Following the CySEC announcement, I have reached out to the Novox Capital Ltd. itself for additional insights into the case. However, the firm’s compliance did not provide me with any comment yet. The firm is expected to provide an official release later today.
CySEC proposes new Binary Options reforms
Cyprus was one of the first authorities ever to treat binary options like financial instruments. The regulator one of the first institutes to offer binary options brokers the opportunity to get investment firm licenses. However, the binary options industry has been under fire by officials owing to increased number of fraudulent units. Even EUROPOL held a binary options summit on the 24 January of this year.
Now, the Cypriot regulator has published a Circular with a range of proposed changes to regulations. This aimed at improving the obligations of binary options brokers so that CIFs will “meet their compulsions in acting in the best interest of their clients”.