Dutch regulator confirms series of fines imposed on 24option.com operators
The Dutch Authority for the Financial Markets (AFM) today confirmed the imposition of a series of fines on the operators of CFD trading platform 24option.com. The fines were apparently issued in December 2020 but the regulator provided information about the penalties today, more than a month after they were imposed.
The AFM confirms it issued a total of six fines in relation to 24option.com. The fines targeted Rodeler (NL) B.V., Rodeler Limited and Mr A. Shkuri, a regional manager.
The regulator has determined that Rodeler NL has provided investment advice to clients without having the required license and has been guilty of aggressive and misleading trading practices. The AFM has imposed fines not only on Rodeler NL itself, but also on its parent company Rodeler Ltd and on regional manager A. Shkuri.
Until early 2018, Rodeler Ltd and its subsidiary Rodeler NL, with a license in Cyprus and a European passport in the Netherlands, offered CFDs to retail investors. Rodeler NL also provided investment advice, for which it did not have a license. This is a violation of the Netherlands’ Financial Supervision Act.
Furthermore, investors were deliberately misled by Rodeler NL about the risks of CFD investments. Rodeler NL made it appear as if it had the customer’s interest in mind, but in reality it aimed at customers’ losses. On average, customers lost about half of their investment. Rodeler NL employees also persistently chased customers by telephone. The second fine was imposed on Rodeler NL for these unfair commercial practices.
Rodeler Ltd set out the policies for Rodeler NL from Cyprus. That is why the AFM has also imposed two fines on the Cyprus-based company. Also, A. Shkuri, as general manager for the Netherlands within Rodeler NL, was responsible the policy and ensured that the account managers achieved their targets in any case. The AFM has therefore also imposed two fines on him.
The AFM explains that such law violations usually trigger high penalties. In these cases the amounts are relatively low, mainly for reasons of financial capabilities. Rodeler NL ceased its activities in mid-2018, Rodeler Ltd’s license was suspended in mid-2019 and it has already paid a fine of €280,000 in Cyprus as a settlement. A. Shkuri has also shown that he cannot bear a large fine.
Due to these factors, the six fines imposed by the Dutch regulator total €375,000. The sum includes fines of €160,000 imposed on Rodeler NL, €140,000 – imposed on Rodeler Ltd, and €75,000 for A. Shkuri.
This case is not an isolated one. Since 2019, the AFM has received hundreds of signals about offers of CFDs by foreign investment platforms. Consumers have often lost their entire investment, from tens of thousands to sometimes hundreds of thousands of euros.