The Cyprus Securities and Exchange Commission (CySEC) has
made an announcement regarding the Investors Compensation Fund (ICF) and the
withdrawal of membership status for Leverate Financial Services Ltd.
Revoking CIF Authorization and ICF Membership
According to CySEC, the withdrawal of ICF membership for
Leverate Financial Services Ltd. does not imply the loss of rights for covered
clients to receive compensation for investment operations conducted up until
the point of membership status loss. The conditions for compensation outlined
in the Directive remain applicable.
The decision to withdraw ICF membership has followed CySEC‘s
move to revoke the Cyprus Investment Firm authorization of Leverate
Financial Services Ltd.
CySEC’s Annual Report: Compliance Measures and Regulatory
Priorities
In 2023, the
CySEC conducted inspections totalling over 700 on-site and remote checks on
supervised entities, imposing fines exceeding $2.2 million to ensure regulatory
compliance and safeguard investors, as reported by Finance Magnates. Thematic audits
focused on entities affected by the Russia-Ukraine sanctions, scrutinizing
their business relationships and investigating forced transfers of Russian
securities.
The Market Surveillance and Investigations Department
completed 42 investigations, with one case forwarded to the Attorney General
for potential criminal prosecution, while ongoing inquiries numbered 48 by
year-end. CySEC imposed administrative penalties amounting to approximately
€2.2 million, with a single investment firm bearing €1 million.
Over three years, €6 million in sanctions have been levied,
predominantly against investment firms for regulatory violations. By
comparison, the Financial Conduct Authority in the UK revoked licenses for
1,266 unauthorized firms and issued record fines of £52,802,900, while U.S.
regulators imposed fines exceeding $9 billion collectively. CySEC also
instructed entities to rectify issues in 103 instances, with 35 entities
mandated to comply with anti-money laundering and counter-terrorist financing
laws.
Additionally, CySEC revoked or suspended licenses for 19
investment firms and two collective investment undertakings. In an exclusive
interview, CySEC’s Chairman, George Theocharides, highlighted cryptocurrencies
and artificial intelligence as paramount regulatory concerns, anticipating
their transformative impact on the financial industry.
This article was written by Tareq Sikder at www.financemagnates.com.
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