In a newly published press report, the Cyprus regulator just got tougher on binary option brokers that operate in other European countries with a CIF trading license but without the necessary authorizations. As you may now know, the CySEC is the only European financial regulator that considers binary options as a proper financial instrument. Binary option brokers are thus almost all regulated in Cyprus with a CIF (Cyprus Investment Firms) trading license enabling them to offer forex and binary options trading services all across Europe once they have received the necessary authorizations from each domestic regulator. Moreover, these Cyprus Investment Firms licensed brokers need to inform the CySEC about their activities in third countries and obtain a specific approval from the Cyprus regulator to do so.
CySEC warns non authorized binary option brokers
In a circular released yesterday, the CySEC sent a clear and tough warning to Cyprus Investment Firms which have been included in the Investors Alert Portal operated by the International Organization of Securities Commissions (IOSCO). Some Cyprus regulated brokers were indeed the targets of investor complaints and have been included in the Investors Alert Portal list. This list includes all the brokers that have been the subjects of an alert by European investors on a large range of different issues (withdrawal delays, withdrawal problems, price discrepancies, platform outage, hidden fees…)
The CySEC is ready to take supervisory measures
The CySEC warned that Cyprus regulated binary option brokers that have been issued warnings by IOSCO members have until the 23rd of December 2015 to provide further details about the situation and inform the regulator of actions taken in this respect. The CySEC also reminded Cyprus investment firms that in absence of its approval as well as the relevant authorizations form the regulators of the third countries; they were not allowed to offer there trading services in the related countries.
In its official press release, the CySEC warned CIF brokers that it would conduct further investigation and even implement sanctions to companies that do not regularize their situation by the end of the deadline. The regulator already imposed fines and withdrew trading licenses in similar situations.
A positive development for the binary option industry
It is a non-conventional move from the CySEC that made it clear to binary option brokers that it would no longer accept the kinds of misconducts the sector has been suffering over the last year. This tougher stance on Cyprus Investment Firms also comes after many respected European financial regulators (FCA in the United Kingdom, AMF in France, CONSOB in Italy…) voiced concerns about the professionalism of the Cyprus regulator. Many of these regulators are updating their broker blacklists with brokers that are regulated by the CySEC but that do not comply with the restrictions of the Cyprus regulator. We strongly hope that this warning will force fraudulent brokers out of business and improve the reputation of reliable brokers in Europe.
As you can guess, none of our recommend brokers were mentioned in the Investors Alert Portal operated by the International Organization of Securities Commissions (IOSCO). It proves that we carefully selected our list to only recommend the best and most reliable binary option brokers in Europe. Don’t hesitate to have a look at our reviews of 24option, Interactive Option, Anyoption, TopOption and IG binary for further information. They have all received the required authorizations to operate in Europe and offer the best trading conditions for binary option traders.
Please find the official CySEC circular here.