RE: FCA v 24HR Trading Academy Limited and MR M F Maricar – Neutral Citation:[2021] EWHC 648 (Ch).
Litigation and Dispute Resolution.
Fast-evolving Crypto market and FX Trading – (such as ‘futures contracts’, ‘contract fordifference’ and ‘option’ and ‘securities’) is it a Criminal Offence to introduce?‘Arranging’, ‘selling’ or ‘advising’, which is not always obvious to an untrainedintroducer/promoter, could land them in contravention of FSMA 2000 and lead to a possiblecriminal offence.
Having been heavily involved in the High Court’s decision in Avacade as reported byLaw360, FTAdviser, Bloomberg, and International Advisor, etc., and more recently in at theCourt of Appeal in early July 2021, we highlighted the implications of being an unregulatedintroducer and the danger of inducing UK Consumers to trade in Cryptocurrency derivativese.g. CFDs on FX-trading platforms.
Relying on Avacde, the FCA sued Mr. Maricar personally. He mistakenly assumed that he was exempt from introducing consumers to AvaTrade and VantageFX, but little did he know that he would be held personally liable (albeit traded through his limited company) for£530,695.00 plus interest and costs, together with an injunction against his company preventing it from continuing to transmit trading signals. The High Court found that transmitting trading signals amounted to ‘advice’, and therefore a breach of FSMA 2000 –see FCA v 24HR Trading Academy Limited and MR M F Maricar – Neutral Citation[2021] EWHC 648 (Ch).
It is clear that, having considered the effect of the above judgment, all unregulated introducers (not regulated by the FCA) must exercise extreme caution and seek independent legal advice.
For a full litigation risk assessment of your Crypto derivatives (such as CFDs), FX-trading, financial services introducer business, please visit www.zakerykhub.com email:
The End
22 July 2021