The Board of the Cyprus Securities and Exchange Commission (CySEC) wishes to inform investors that, at its meeting held on September 5th 2016, decided to impose a total administrative fine of €180,000 ($202,356) to the CIF IQ Option Europe Ltd.
As a result of the same meeting, CySEC also decided to impose a total administrative fine of €138,000 ($155,139) to the Binary Option brokerage CIF OptionRally Financial Services Ltd.
The sum total of the fines issued against these two firms today provided over $350,000 to the regulator.
Charges laid out against IQ Option include:
- Non-compliance since its head office was not situated in Cyprus.
- The Company did not establish and maintain adequate policies, measures and procedures regarding the approval of the information addressed and provided to clients, the assessment of appropriateness and the assessment of the chosen liquidity provider.
- The Company did not maintain adequate and orderly records of client orders, client transactions, marketing material and the approval of information addressed to clients prior to the agreement for the provision of services, and of its affiliates, and was not in a position to make these available to the CySEC.
- Did not take reasonable measures to avoid any unjustified aggravation of the operational risk, when outsourcing activities or operational functions to third parties,
- The information on clients’ online accounts and the information on sample marketing material assessed, were not fair, clear and non-misleading
- Did not take all the reasonable steps to obtain, when executing orders, the best possible result for its clients, since due to the strike and expiry prices used, in comparison with market prices of the underlying assets, resulted in loss making trades for clients, rather than profitable trades.
To view the detailed Board Decision on IQ Option click here.
Charges laid out against OptionRally include:
- Approval of marketing material and information addressed to clients or potential clients.
- The Company did not maintain adequate and orderly records of the information relation to the assessment of its marketing material (record of approval of its marketing material).
- Unjustified aggravation of the operational risk when outsourcing activities or operational functions including marketing and customer service.
- Failed to act fairly, honestly and professionally in relation to the bonus terms and conditions accepted by the Company’s clients and the practices applied to this respect.
- Information provided to clients/potential clients on its website, were not appropriate so that the clients are reasonably able to understand the nature and risks of the investment service offered.
To view the detailed Board Decision on OptionRally click here.