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Re:

CySEC Suspends the Stocks Forex Ltd. CIF Licence

CySEC suspended Stocks Forex AF Ltd’s CIF authorisation in January 2020 after citing capital shortfalls, missing reports and undisclosed exposures. The authorisation was later withdrawn in 2021 following the company’s voluntary renunciation.
From TheFinanceBase Team5 min to read
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CySEC suspended the Cyprus Investment Firm (CIF) authorisation of Stocks Forex AF Ltd on January 13, 2020. The regulator announced the decision on January 22, 2020.

The suspension followed failures involving the firm’s capital, regulatory reporting and exposure disclosures. It stopped the company from providing investment services, taking on new clients or advertising itself as an investment-services provider. The authorisation was later withdrawn in 2021 after the company expressly renounced it.

Which company did CySEC suspend?

The exact legal name in CySEC’s decision is Stocks Forex AF Ltd, rather than “Stocks Forex Ltd.” The firm held CIF authorisation No. 283/15, granted on November 13, 2015. Its Cyprus company registration number was 327418.

The regulator’s decision page was published on January 22, 2020, but the decision itself was dated January 13, 2020. That distinction matters when reconstructing what happened and when the restrictions took effect.

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Why was the authorisation suspended?

CySEC cited three compliance failures in its suspension decision:

  1. Insufficient capital: the company’s own funds and initial capital were below the applicable minimums under Articles 92(1) and 93(1) of Regulation (EU) No. 575/2013.
  2. Missing capital-adequacy reports: the firm did not submit the required capital-adequacy forms, contrary to Article 7(1) of Implementing Regulation (EU) No. 680/2014.
  3. Undisclosed exposures: the company failed to disclose its exposures as required by paragraph 61(4) of Directive DI144-2014-14.

CySEC said these alleged breaches created concerns about protecting the company’s clients and investors. It also said they posed a threat to the orderly operation and integrity of the market.

The legal basis for the whole-authorisation suspension was section 71(6)(c) of Cyprus’s Investment Services and Activities and Regulated Markets Law of 2017, together with section 9(1) of Directive DI87-05. The regulator’s official suspension decision sets out the cited provisions and restrictions.

What could the firm no longer do?

For the duration of the suspension, Stocks Forex AF Ltd was prohibited from:

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  • providing or carrying out investment services or activities;
  • entering into business transactions with any person or accepting new clients; and
  • advertising itself as a provider of investment services.

In practical terms, the firm could not continue operating as a normal investment-services business or use its CySEC authorisation to attract new customers.

Could existing clients still close positions or receive funds?

Yes. The suspension did not impose an absolute ban on every activity involving existing clients. Subject to those clients’ wishes, the firm could:

  • complete its own transactions and clients’ transactions that were already before it, in accordance with client instructions; and
  • return funds and financial instruments attributable to clients.

These permissions were limited to completing existing business and returning client assets. They did not allow Stocks Forex AF Ltd to accept new clients, start new investment business or resume ordinary operations.

How long did the firm have to correct the problems?

CySEC gave the company one month to take corrective action and comply with the provisions identified in the decision. The decision did not say that the authorisation would automatically be restored after that month. A deadline to remedy breaches is not the same as an automatic licence reinstatement.

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Was the licence eventually withdrawn?

Yes, but not at the time of the January 2020 suspension.

At a meeting on May 10, 2021, CySEC decided to withdraw authorisation No. 283/15 because Stocks Forex AF Ltd had expressly renounced it. The withdrawal announcement was dated May 20, 2021. CySEC’s current former-investment-firms register categorises the authorisation as “Voluntary Renunciation.”

Date Event
November 13, 2015 CIF authorisation No. 283/15 granted to Stocks Forex AF Ltd.
January 13, 2020 CySEC suspended the authorisation in whole.
January 22, 2020 The suspension announcement was published.
May 10, 2021 CySEC decided to withdraw the authorisation after the company expressly renounced it.
May 20, 2021 The withdrawal announcement was dated.

What does this mean for customers?

Anyone dealing with a firm affected by a regulatory suspension should stop relying on old marketing claims or historic licence details. A past CySEC authorisation does not show that the firm is currently authorised.

Customers should verify the firm’s current status through CySEC’s official registers, keep account statements and transaction records, and use official contact details when requesting withdrawals or information. If money or financial instruments remain outstanding, preserve correspondence and obtain professional advice about available complaint or recovery routes.

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The January 2020 decision itself does not find fraud, theft of client money or other criminal conduct. It identifies capital, reporting and exposure-disclosure failures, and explains why CySEC considered those failures a risk to clients and the market. Those facts should not be expanded into allegations that the regulator did not make.

The accurate takeaway

CySEC first suspended the whole CIF authorisation of Stocks Forex AF Ltd in January 2020. The company could not provide investment services, accept new clients or advertise itself as an investment-services provider, although limited existing-client transactions and the return of client assets remained permitted.

The authorisation was later withdrawn in 2021 following the company’s voluntary renunciation. It was not immediately permanently withdrawn on January 22, 2020, and the official decision does not establish fraud or client theft.

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FAQ

Did CySEC suspend Stocks Forex Ltd or Stocks Forex AF Ltd?

The exact legal entity named in CySEC’s suspension decision is Stocks Forex AF Ltd. Some reports shortened the name to Stocks Forex Ltd, but Stocks Forex AF Ltd is the name in the official decision and register.

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When did CySEC suspend the CIF authorisation?

The decision was dated January 13, 2020, and the announcement was published on January 22, 2020.

What were the reasons for the suspension?

CySEC cited insufficient own funds and initial capital, failure to submit capital-adequacy forms, and failure to disclose exposures.

Could the firm return client money during the suspension?

Yes. Subject to the relevant clients’ wishes, it could return client funds and financial instruments and complete transactions already before it in accordance with client instructions.

Was the authorisation permanently withdrawn in January 2020?

No. January 2020 brought a suspension. CySEC later withdrew authorisation No. 283/15 in 2021 after Stocks Forex AF Ltd expressly renounced it.

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Did CySEC find that the firm committed fraud?

The suspension decision does not make a finding of fraud or client theft. It describes capital, reporting and exposure-disclosure failures and the risks CySEC said they created.

The Bottom Line

Bottom line: CySEC suspended Stocks Forex AF Ltd’s CIF authorisation No. 283/15 on January 13, 2020, citing capital shortfalls and regulatory-reporting failures. The firm was barred from normal investment business and new clients, while limited wind-down activity remained possible. CySEC later withdrew the authorisation in May 2021 after the company voluntarily renounced it.

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