The Cyprus Securities and Exchange Commission (CySEC) has imposed a total administrative fine of €50,000 on Fiduserve Asset Management Ltd, the investment fund manager licensed in Cyprus.

The regulator's decision cited multiple violations of the Investment Services and Activities and Regulated Markets Law by the company.

CySEC Imposes €50,000 Fine on Fiduserve Asset Management

The largest portion of the fine, amounting to €20,000, was levied for Fiduserve's failure to obtain necessary information about investors' financial situations, investment objectives, and risk tolerance levels during the period from June 2018 to October 2021. This breaches the part of the regulation that requires investment firms to recommend suitable financial instruments aligned with clients' profiles and risk appetites.

Furthermore, CySEC imposed a €15,000 penalty for failing to provide periodic statements with the required content to investors whose portfolios allowed leveraged management between December 2018 and October 2021. Additionally, Fiduserve neglected to inform investors when their portfolio values decreased more than 10% on several occasions from September 2019 to December 2020.

A €5,000 fine was issued for not sending updated statements to investors regarding how their investments corresponded to their preferences, objectives, and characteristics during the same period.

Finally, CySEC fined Fiduserve €10,000 for providing investors with inaccurate, unclear, and misleading information.

In arriving at the €50,000 total administrative fine, CySEC carefully considered several factors that underscored the gravity of Fiduserve's violations. However, the company's cooperation during the investigation and its clean record were also factored into the final penalty amount.

CySEC Imposes Second Major Fine of the Year

The €50,000 fine imposed on Fiduserve Asset Management Ltd marks the second significant penalty handed out by the regulator in 2024.

Earlier this year, in February, CySEC settled with Fintailor Investments Ltd, requiring the firm to pay €200,000 for potential breaches of anti-money laundering regulations. In the latter part of 2023, CySEC took enforcement actions against several other investment firms.

In December, the regulator settled with Naga Markets Europe Ltd, a Cyprus-licensed company that is part of the publicly listed NAGA Group in Germany, for €150,000. The settlement addressed various regulatory violations that occurred between January 2021 and April 2022.

Also, in December 2023, CySEC imposed a €50,000 monetary penalty on Begin Capital Markets for "possible violations" of local regulations. This was not the first time the regulator had taken action against the company, highlighting its ongoing efforts to maintain compliance within the industry.

In addition to imposing fines and reaching settlements with investment firms, CySEC has proactively issued warnings to protect investors from unauthorized entities. In late February 2024, the regulator added 10 new websites to its list of unauthorized service providers.