CySEC has suspended the Financial License from ACFX(Atlas Capital FX).
ACFX, or it is also called Atlas Capital FX is a part of one of the biggest conglomerate in Europe, Atlas Capital Group.
It was believed to be growing one of the biggest brokers and financially stable by its background situation.
Many investors have been surprised by the “Suspension of CySEC License” to ACFX.
What happened to ACFX?
ACFX’s main financial regulation is “CySEC” in Cyprus.
On 7th of April, that CySEC has officially announced that it has suspended ACFX’s financial license.
It is due to the withdrawal delays caused by ACFX against some Chinese traders who have traded “Swap Arbitrage” and gained unauthorized profit according to ACFX.
ACFX is not now allowed to provide financial services and its clients have got only one option to do, which is “withdrawing funds”.
Thanks for the decent business ACFX was running, client funds deposited into the segregated bank account which is separated from the normal operation, are being withdrawn accordingly.
Would you like to know more about this? Let’s dig into more details about this topic.
Arbitrage Abusing Bonuses
ACFX used to offer Deposit Bonuses to its clients, and it has been bothered by number of traders abusing bonus conditions.
It is the Arbitrage trading abusing these deposit bonuses, and no brokers either ACFX allow that trading method.
But fortunately(to these traders), ACFX has processed withdrawals for them in order to protect its brand and reputation.
ACFX knew that “Arbitrage Trading” is really bothering and has no merit for the broker itself.
ACFX has specified the conditions of “Arbitrage”
Just like many other brokers, ACFX has specified the conditions of some types of “Arbitrage Trading”s in its Terms and Conditions.
But apparently it is not a good enough to be the reason to delay(or reject) withdrawal requests.
It is probably the broker’s fault who has failed to manage risks on its trading platforms.
Swap Arbitrage on Oils
A few months before the “Suspension of the License”, ACFX has started promoting its “High Swap Rate of Oils”.
This promotion might have awaken some clever(or smart?) traders to trade Oils in order to earn Swaps by Oil positions.
As this is the main reason why ACFX has delayed withdrawals and its license has been suspended in the result.
Arbitrage is prohibited by mane brokers
Not to mention, “Arbitrage Trading” is prohibited by all online Forex Brokers.
Even a broker with complete STP(Straight Through Processing) environment, restricts “Latency Arbitrage” on CFD instruments.
It is a really smart way to earn profits without risks though, perhaps it may not be worth a risk.
Worst case scenario of ACFX
As ACFX has been suspended from Providing Financial Services, all you can do is withdraw your funds or leave the fund as it is.
The broker is processing withdrawals accordingly without rejecting it by following the order of CySEC, so if you haven’t received your funds yet, you may just need to wait for them to process your request in the near future.
As ACFX was regulated by CySEC, it is also their responsibility to be a member of ICF(Investor Compensation Fund).
ICF holds more than 17 million Euro and compensate up to 20,000 Euro per person, in case the broker fails to meet its obligation with its clients.
This may be going to be a good case study to mention how important to choose a regulated broker.
