The Cyprus Securities and Exchange Commission (CySEC ) has issued an announcement highlighting that the financial services company license of the entity behind the FxPulp brand has been suspended.
The regulator outlines that at its meeting on February 16th, it has decided to withdraw the authorization of the Cyprus Investment Firm "Pulp International Business Ltd." The license is now considered suspended with suspicions of the firm violating the law on two counts.
The first is related to "Operational requirements – Clients’ funds," and "Safeguarding of clients’ funds." The second prospective violation is connected to the "Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007."
According to the statement issued by CySEC, the license suspension decision has been taken as the regulator has become concerned about the company’s clients' interests and "the smooth operation of the capital market."
The regulatory announcement stated that FxPulp has ten days to take actions in order to comply with the provisions in the laws mentioned by the watchdog.
For the duration of the license suspension, Pulp International Business Ltd. and its brand, FxPulp, do not have the right to "provide/perform any investment services/activities." In addition at the discretion of its existing clients, the company must close all open positions in relation to clients’ contracts, if they so desire.
According to CySEC the company also has to return to existing clients all of their funds and profits earned.
The move comes just weeks after the most tumultuous development on the foreign exchange market in recent years forced a number of brokerages out of business. Forex Magnates reporters attempted to contact FxPulp to obtain more information but at the time of publication have not received an answer from a company representative.
According to the website of the brokerage, depositors who open a so called "standard" account with a minimum of $10,000 are offered up to 300% bonus. In addition, the website boasts a referral bonus of 10% totalling up to $2,000 per new client.
Back in 2009, Forex Magnates reported about an alleged connection between FxPulp and the infamous Swiss brokerage Crown Forex. At the time FxPulp was just starting its Cypriot operations. Crown Forex, was a Swiss forex broker which was shut down by FINMA due to a number of irregularities. The case went to court which decided to liquidate the company.
