CySEC Cancels CIF License of AFX Capital Markets Ltd

The Cyprus Securities and Exchange Commission (CySEC) announced on Thursday that it has withdrawn the Cyprus Investment Firm (CIF) authorisation of AFX Capital Markets Ltd, the Cypriot arm of AFX Markets Ltd. During the second half of this year, the regulator has withdrawn the CIF license of four companies including Sonaf Business Ltd, London Capital Group (Cyprus) Ltd, Belight Capital Group Ltd, Globia Wealth Ltd.

According to the CySEC, the decision was made because the company no longer meets the conditions under which the authorisation was granted and seriously infringed its provisions through detailed investigation. In addition, some of the company's important board members have violated the regulatory provisions. "They did not define, and in effect did not oversee the implementation of, governance arrangements that ensure the effective and prudent management of the Company, in a manner that promotes the integrity of the market and the interest of clients," stated the Cypriot watchdog.

Pursuant to the related regulatory provisions, the regulator imposes to Mrs. Manuela Mazzacco, Executive Director of the Company, an administrative fine of €100.000 and a ban for a period of five(5) years to exercise management functions in CIFs. Andreas Lianos, another Executive Director of the company, is imposed an administrative fine of €50.000 and a ban of three years. Three other Non-Executive Directors, Costas Georgiades, Elena Economides Demetriou and Andrea Papagapiou are spared from the regulatory actions due to comprehensive consideration of their capacity in the company. 

In addition, the CySEC has taken action against the two auditors of AFX Capital Markets, imposing €100,000 in administrative fines each to BDO Ltd and Anthimos, Leonidou and Partners Ltd for they did not ensure the correctness, completeness and accuracy of the report submitted to the regulator.

​AFX Capital Markets was granted a CySEC license in 2010, and was running numerous investing platforms. In 2019, its CIF license was suspended due to alleged violations of investment services laws, as well as non-compliance with the Directive about the safeguarding of clients' funds. Special administrators of AFX's UK arm disclosed to the regulator that the company was in terrible financial difficulty and that it had a heavy shortfall in client money of more than £7.0 million.