Material Deficits Reported by Cyprus
It was announced today by the Cyprus Securities and Exchange Commission that it’s nearly concluded their formal investigation regarding the alleged violations made against Capital Markets AFX Ltd. These violations came after some unidentified individuals reported that this brokerage firm was breaking regulation law. However, CySEC hasn’t completed its formal investigations and continues to determine the position of the client’s money. Though the regulator noted that their initial findings indicate that there’s a significant deficit with their firm.
CySEC mentioned that further investigation methods are required to make a conclusive decision on Capital Markets AFX. Trying to save themselves from these allegations, Capital Markets publicly stated that their company had fallen under financial difficulties. This brokerage firm claims that this is why £7.0 million cannot be accounted for in the deficit. However, CySEC believes that executives with the company stole these funds directly from consumers. Capital Markets have been forced to cease any trading activity going forward and been told to have over their records.
This isn’t the first time that the Cyprus Securities and Exchange Commission identified problems with Capital Markets AFX. They had previously mentioned concerns regarding the lack of safety procedures maintains for client assets. CySEC provided public warnings that sufficient funds with this brokerage wouldn’t be entirely safe. When that happened, the commission suspended Capital Market’s operational license. When funds were then magically lost, significant concerns arose towards the executives. Proof of these illegal actions will prompt criminal proceedings going forward.
One of the processes for investigation is acquiring clients that traded with Capital Markets AFX. They’ll be asked to provide testimonials with necessary details, assisting CySEC in their review of this brokerage. One of the ways that these clients can submit their complaints is through the Cyprus Securities and Exchange Commission’s website, where a unique reference number will be provided for additional details if needed.
These recent investigations have prompted the AFX Group to lose a large percentage of its previously held market. Before these issues arose, the AFX Group was considered the second-largest brokerage in the United Kingdom. It was estimated that their peak client acquisitions came out around 1200, with an average of £7.5 million traded daily.