The Cyprus Securities and Exchange Commission (CySEC ) announced on Thursday the commencement of the compensation process under the Investor Compensation Fund (ICF) for the clients of Maxigrid Ltd, which operates FX and CFDs broker brands, Dualix and AGM Markets.
Now, the regulator has detailed the process of claiming compensation, which can be done both online and offline with supporting documents.
“Covered clients must submit their claims against the Company, if any, arising out of the covered services, by the 30th of April 2023,” the regulator added.
CySEC’s ICF covers the deposits of all clients of any locally regulated financial services company up to €20,000. The compensation funds are used in the case of the service providers becoming bankrupt or unable to return customer deposits due to financial constraints.
A Troubled Broker
Maxigrid ran the operations from its Cypriot base after receiving a Cyprus Investment Firm (CIF) license in 2011. However, its license was withdrawn by the Cypriot regulator last February. The broker violated multiple mandatory compliance rules that led to the cancellation of its license.
In addition, the broker's license was suspended multiple times before cancellation.
The Cypriot regulator initiated ICF proceedings for Maxigrid last June after the regulatory board decided on it in late March. According to the regulator, the brokerage operator is “unable to meet its obligations arising out of investors' claims and has no early prospect of being able to do so.”
The latest regulatory announcement added: “Before submitting an application to the ICF, all parties concerned (covered clients of the Company) are invited to study the relevant provisions of MiFID II, the ICF Directive, as well as the information on the submission of applications for payment of compensation posted on the CySEC website and take all necessary actions to submit their claims. The existence of a valid claim by the claimant is an essential requirement for receiving the compensation.”
