CySec decided to impose a €100.000 administrative fine to a Cyprus Investment Firm
The Board of the Cyprus Securities and Exchange Commission (CySec) has issued an announcement to inform the public that, at the meeting held on 28 November 2016, it decided to impose a total administrative fine of €100.000 to CIF Colmex Pro Ltd for non compliance with the following:
1. the Investment Services and Activities and Regulated Markets Law of 2007, as amended from time to time (‘L.144(Ι)/2007’),
2. the Directive DI 144-2007-01 of 2012 of the Securities and Exchange Commission for the Authorisation and Operating Conditions of CIFs (‘Directive 1’),
3. the Directive DI 144-2007-02 of 2012 of the Securities and Exchange Commission for the professional competence of Investment Firms and the natural persons employed by them (‘Directive 2’).
The administrative fine imposed on the Company is broken down as follows:
A. €10.000 for non-compliance with Section 28(1) of L.144(Ι)/2007 as it failed to comply at all times with the authorization and operating conditions, as laid down in Section 18(2)(a) of L.144(Ι)/2007 and paragraph 14 of Directive 1, as it did not establish, implement and maintain adequate policies and procedures in order to ensure compliance with its obligation under L.144(Ι)/2007 and paragraph 14 of Directive 1. Specific, the Internal Operational Manual that the company establishes, implements and maintains does not include the specific policies and procedures applied in relation to the suitability assessment and the information provided or given to clients or potential clients.
Β. €20.000 for non-compliance with Section 28(1) of L.144(Ι)/2007 as it failed to comply at all times with the authorization and operating conditions, as laid down in Section 18(2)(d) of the L.144(Ι)/2007 and paragraph 16, subparagraphs 3(b),(c),(d) and (e) of Directive 1, since it did not take reasonable measures to avoid any unjustified aggravation of the operational risk in the outsourcing of activities or business operations to third parties.
C. €30.000 for non-compliance with Section 36(1)(a) of L.144(Ι)/2007 and paragraph 6(2) of Directive 2, as the information contained in its website, the information through clients’ online accounts, as well as the information in the advertising announcements that have been reviewed, were not fair, clear and non-misleading, as defined in Section 36(1)(a) of L.144(Ι)/2007 and the Company failed to ensure that these comply with the terms of paragraph 6(2)of Directive 2.
D. €40.000 for non-compliance with Section 36(1)(d) of L.144(Ι)/2007 and paragraphs 15 and 16 of Directive 2 as it failed to ask clients to provide the necessary information regarding their knowledge and experience in the investment field relevant to the specific type of financial instrument offered, in order to be able to assess whether the investment service or financial instrument envisaged is appropriate for the client, and in cases that it considered that the proposed investment service or financial product was not appropriate, did not warn the client accordingly.
Source: CySec (In Greek)