Belgium FSMA warns for companies that offer trading software-Expert Advisor
The Financial Services and Markets Authority (FSMA), an autonomous public institution that supervises the Belgian financial sector, has published a warning to inform about companies that offer trading software (Expert Advisors).
The FSMA is warning against Finiko, a company that offers so-called ‘Expert Advisors’ or ‘EAs’ used to trade in CFDs, forex and crypto-derivatives.
An Expert Advisor is a type of software that tells you when to make certain trades or even carries them out for you automatically, based on preprogrammed parameters.
The FSMA notes that ever more companies are distributing such Expert Advisors, including to Belgian consumers. This comes with risks.
First, these companies do not have an authorization to offer financial services and products in Belgium.
Moreover, the FSMA has found that such trading software often occurs via a pyramid structure. In general, these are referred to as ‘MLM’ (multi-level marketing) schemes, in which consumers are incentivized to bring in new members. In exchange, they receive compensation in the form of a commission or discount on the price of the software package.
Such MLM networks appear to be active on social media via countless (private) groups. It appears that these schemes mainly target young people. The message is that everyone can afford a luxurious lifestyle provided they bring in enough new members and make the appropriate investment in the software being promoted.
The FSMA also wishes to emphasize that distribution of certain financial instruments that are available via the software (such as CFDs, forex and crypto-derivatives) is prohibited in Belgium.
Source: FSMA
