Cyprus financial regulator CySEC has issued a Board Decision announcing the suspension of the CIF license of Indication Investments Ltd. Indication Investments operates the Libertex Retail FX and CFDs brand, at website libertex.com.

Libertex / Indication Investments was fined €160,000 last year by CySEC fine for issues that included not executing certain client orders on terms most favorable to the client, and offering more than the maximum 30x leverage allowed to retail traders. The current alleged violations (see more on that below) are of a more serious nature against Libertex, which remains the Official Trading Partner of EPL team Tottenham Hotspur.

Technically, CySEC stated that Indication Investments CIF license number 164/12 is “suspended partially”, as the regulator said it has suspicions of alleged violations of:

1. Article 42 of Regulation (EU) no. 600/2014, as the Company does not appear to comply with paragraphs 4(1)(d) and 4(e) of Directive DI87-09 for the restriction on the marketing, distribution, and sale of CFDs to retail clients.

2. Article 22(1) of the Law, as the Company does not appear to comply at all times with the condition for authorisation provided in article 17(2) of the Law, regarding the organisational requirements.

3. Article 25(1) of the Law, as the Company does not appear to act honestly, fairly and professionally when providing investment services to clients, in accordance with the best interests of the clients.

4. Article 25(3)(a) of the Law, as the Company does not appear to provide information, including marketing communications, to its clients or potential clients that is fair, clear and not misleading.

The regulator added that the above decision was reached as the aforementioned alleged violations cause concern and risk relating to the protection of the Company’s clients and/or constitute a threat to the orderly operation and integrity of the market.

Regarding the “partial suspension” of the Company’s authorization, CySEC said that involves:

i. Prohibition to accept any new client and to enter into any business transaction with them.

ii. Prohibition to advertise itself as a provider of investment services. To ensure this the Company is prohibited from marketing/advertising its services to current or potential clients as well as to communicate with them for this purpose, either directly or via third parties with whom the Company cooperates for customer support.

iii. For as long as the suspension of the authorisation is in force, the Company is obliged to publish in all its websites an announcement relating to the partial suspension of its authorisation and its inability to provide/carry out investment services/activities to new clients.

iv. The Company is not permitted to allow its existing clients to proceed with new deposits unless they explicitly request to do so and at the same time such deposits are made for the sole purpose of covering the margin requirements of the clients’ existing open positions.

CySEC said that Indication Investments must take, until the 17th of September 2021, the necessary actions to comply with the aforementioned provisions.

For as long as the suspension of the authorisation is in force, the Company, provided this is consistent with the wishes of its existing clients, may proceed with the below actions, without such actions being considered as breach of section 9(7)(a) of DI87-05:

(i) Complete all its own transactions and those of its clients which are before it, in accordance with client instructions.

(ii) Return all funds and financial instruments which are attributable to its clients.