Bad news comes from Instant Trading EU Ltd, which is the parent company of brokers ForexMart, InstaForex and InvestCity. Last August, CySEC fined a total of 130,000 Euros against the company located in Limassol.

Reporting from Leaprate, the fines imposed by CySEC were based on two things, namely:

• A fine of 90,000 Euros because the company was deemed not to have acted fairly and honestly ​​to the interests of clients. More specifically, CySEC noted the company's non-compliance regarding the use of leverage, providing trading bonuses/benefits to clients and protecting clients' negative balances.
• A fine of 40,000 Euros is because the company is considered to have failed to provide a track record of the client's experience and knowledge in the world of trading. In fact, this data is important because it is used by CySEC to assess whether investment services and products are appropriate for the clients of the companies it shelters.

Many Factors Mitigate Sanctions

Following the sanction, CySEC also requires companies to be more careful in gathering information about client experience and knowledge to assess whether the investment services provided are appropriate.

Despite imposing material sanctions on Instant Trading EU Ltd, CySEC stated that several factors made Instaforex's parent company still included in the regulation. Mitigating factors include the fact that the company immediately took steps to improve and has never made a similar mistake in the past.

Since last June 2018, CySEC has issued stricter policies regarding using leverage and providing bonuses/promotions. As a result, many of the brokers under its auspices created subsidiaries in offshore countries or other regions that allowed higher leverage offers. Facing this, traders are advised first to study the regulations of the broker they will trust to trade with.