Procedure for filing a complaint with CySEC

Procedure for filing a complaint with CySEC

CySEC is a Cypriot regulator, which is loved by many brokers working in Europe and the CIS. Despite the fact that the jurisdiction is considered offshore, CySEC operates under the European MiFID Directive, that is, it operates in the European legal field. The site of the regulator is cysec. gov. cy / home /, where it is most convenient to choose the English interface.

  • Important: the regulator does not consider individual applications, but all complaints are taken into account when conducting supervision. That is, it is worth submitting an individual claim, it will be taken into account, but the probability of solving a trader’s private problem is low. Therefore, it is better to immediately prepare a collective complaint. However, how many traders must subscribe to it in order for the regulator to take action is not indicated on the CySEC website. The regulator asks him to be informed of the problem but recommends contacting the Cyprus Ombudsman directly (financialombudsman.gov.cy) to resolve disputes. The complaint form is located in the “Forms” section.

The first step is to check whether the broker really has a valid regulator license. In principle, this should be done at the time of acquaintance with the broker, but few then follow the publications of the regulator, where information about license cancellation may appear. You can check for a license in several ways:

  1. In the search bar on the main page, drive in the license number. The site will immediately provide a link to the name of the broker, the date of receipt of the license (Created) and the date of its update (Modified). So, the license is valid.
  2. Find the company itself in the registry by name. An important point: the name that is known to be a trademark, brand, and the legal name under which the broker is registered may be different. In the Regulated Entities section, go to the Investment Firms (Cypriot) sub-item. In the alphabetical index, we enter into the search, not the brand name, but the legal entity, usually indicated on the broker’s website next to the license number, in the contacts or at the bottom of the site (for example, for the LiteForex broker this is LiteForex Investments Limited).

The second option to search for a broker is better – here you can see more information, including registration number, phone numbers, address, and domain name (site).

If the broker was not on the list, alas, it makes no sense to file a complaint. If there is a company, then we proceed to the next stage – the direct processing of the claim. To do this, from the main page, go to the Investor Protection section and then to Complaint Regarding CIFS. The page is divided into several blocks, in front of which briefly contains instructions for filling.

  1. The first block is simple. Here you need to enter your details, including passport, phone number, and address of residence. Information is filled out only in Latin letters. If you have a passport, it is better to indicate its data. According to these details, the representative of the regulator can contact the trader, therefore it is important that the information is in accordance with international standards.
  2. The second block is no less important. Here you need to specify the registration name of the company, which was already mentioned above, and the registration number of the broker (this can be seen in the first screenshot). Let us dwell on the list of possible reasons for the complaint. It looks like this:

I will decode this list in more detail:

  • Execution of orders. This includes any claims to the execution of orders: slippage, delay in triggering, non-compliance of quotes, etc .;
  • Investment advise. All claims regarding inaccurate broker recommendations. For example, inaccurate trading signals. True, you can only file a complaint if the broker promised a 100% guarantee of the success of the transaction. In practice, brokers indicate that the trader bears the risk of whether to use the signal or not at his discretion;
  • Portfolio management. The claim of the investment sector company, which in its portfolio indicated information that was untrue;
  • The quality or lack of information provided to the client. Claim for deliberate silence of information about any services or technical issues. For example, false information regarding the profitability of an option or the lack of data on the processing of the provided bonus. True, it is difficult to prove the broker’s fault here, because these conditions are prescribed in the offer or the conditions of the promotion. And the fact that traders do not read them is the problem of the traders themselves;
  • Terms of contact / feed / charge. This includes any violation of the terms of the offer, including problems with the withdrawal of money, incorrect calculation of commissions, etc .;
  • General admin/customer services. Complaints about general user settings account blocking;
  • Unauthorised business being offered or carried out. Any claims regarding violation of EU legislation by a brokerage company;
  • Other. Any other reason that does not fall into any of the above items.

You also need to select a financial instrument and indicate the disputed amount. For Forex and binary options, this is the 6th item (Options, futures …). The remaining items are related to the stock market and investment companies. All drop-down lists are linked with comment boxes, where you can more widely open the problem.

How much the application will be considered is difficult to say. For some complaints, feedback can be received in a couple of weeks – this will only be a preliminary call in order to obtain supporting materials. The question is exclusively in the amount of the claim of the collective application and the number of traders dissatisfied with the broker.

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