Cyprus offers a lot of advantages when it comes to setting up a corporate headquarter, which is one of the main reasons why Cyprus sees the maximum number of Forex brokers offering financial services for traders across the world. Why Are CySEC Regulated Brokers Popular? CySEC has relatively easy regulatory guidelines and a fast approval process that allows CySEC regulated brokers to set up camp in Cyprus with minimum formalities. CySEC also used to be broker friendly in terms of fines or suspension of licenses for misdeeds, which attracted criticism from all quarters of the globe, especially from other European Union members and their regulatory agencies.
CySEC regulated Forex brokers have been known to indulge in financial malpractices and fraud, which had resulted in clients losing millions of dollars on an annual basis. A Pioneer In The Field Of Regulations While CySEC received wide-spread criticism for its governing policies during the initial days, CySEC is clearly a pioneer in terms of bringing ground-breaking regulatory guidelines that changed the financial markets for the better. Since 2012, CySEC has been continuously updating their regulatory framework to incorporate several new initiatives that are designed to safeguard consumers against financial crimes and abuse. CySEC now works extensively with the European MiFID to create guidelines that concentrate on ensuring that all compliant members are honest in their dealings with the general public to ensure the integrity of the markets. Unlike the NFA or CFTC, CySEC does not entertain consumer complaints directly.
The CySEC has instructed all regulated members to address their clients’ complaints in an efficient manner through a dedicated customer support channel. Therefore, a trader should contact their broker directly regarding any complaints and await further instructions on a problem resolution. The primary mission of CySEC is to regulate the markets and to supervise the conduct of financial organizations operating on Cyprus soil. While investor protection is a top priority in their updated mission, consumers can not contact the CySEC directly for any complaint resolution or arbitration services.
Verifying The Authenticity of CySEC Regulated Forex Brokers The relatively easy CySEC regulations provided scam Forex brokers to make false regulatory claims and trick unsuspecting users. Current CySEC regulations state that all Forex brokers are required to quote the five digit CySEC license number prominently on their website. CySEC frequently updates its circulars and warning notices to inform the public about members that have been fined or have their licenses revoked for any financial wrongdoings. In case the consumers are confused about the status of any particular company, they can directly contact the CySEC to get more information. Way Forward CySEC can be considered as a controversy’s play child since most EU regulators often criticise the way CySEC works. Most regulators often feel that the fines levied on members for non-compliance is small, and companies are let off with a simple warning for financial frauds that can get them banned in other countries. Despite the fact that CySEC has a long way to move forward in terms of regulation, it is indeed one of the most popular regulatory organizations that have achieved a tremendous growth rate.
Financial companies still favour CySEC over other agencies due to the relative ease of regulation and lesser formalities. However, all of that is set to change in the next few years if CySEC hopes to be taken seriously by the MiFID. Get the latest Forex updates now! Risk Warning – Your capital is at risk. Trade with caution, these products might not be suitable for everyone so make sure you understand the risks involved! 5 things you should know about Banqoin.
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