The French watchdog has posted the results of AMF Forex brokers mystery shopping tour. Is there any progress this time in comparison to the 2014 mystery visits?
10 March, AtoZForex – The France’s Autorité des marchés financiers (AMF) has been very much active in safeguarding investments and maintaining orderly financial markets. The regulator reveals the results of recent AMF Forex brokers mystery shopping. A similar operation was conducted in 2014 by the French watchdog, but this time the focus was mainly on online trading firms regulated by CySEC. This move followed because the French regulator received a large number of complaints regarding CySEC-regulated Forex and binary options companies.
What did the mystery shoppers verify?
The France’s AMF Forex brokers mystery shopping was conducted recently between August and December 2016. Out of 15 Forex and/or binary options companies which the regulator targeted, 3 of them did not accept French clients. Therefore, only 12 companies in total were tested by the watchdog whereas in 2014 they targeted 29. The mystery shoppers verified the content of websites, including advertising, the opening of accounts, verification procedures, transactions, client questionnaires, the customer support, the actual trading along with the possibility of closing the account and withdrawing funds.
Outcomes of AMF Forex Brokers Mystery Shopping
All of the companies offered a questionnaire to their prospective clients to check their investor ability. Finally, it was totally at investor’s discretion to decide if trading was their cup of tea or not. Moreover, a positive sign was that all of the companies sent a warning message if the investor was introduced as a newbie. The warning message was to prevent the prospective client from trading. Considerably, there was an improvement in KYC practices compared to 2014. Because the AMF check back in 2014 showed that often no ID was required to open an account and trade. Even there was some progress in terms of less aggressive advertising on the websites.
On the other hand, the Forex and/or binary options education advertising was often misleading. In fact, 50% of the tested companies lack to provide the education services advertised. Also, the information provided was not according to the level of knowledge of the specific client. In terms of trading, investors rarely had an idea about the amount they risked when they placed an order. Most of the time, the traders were unable to verify the trade because the operations were carried out within one click.
There was a drastic improvement in terms of withdrawing the funds compared to the mystery visits in 2014. Interestingly, all of the mystery clients were able to close their account and withdraw their money without any problem. In 2014, there were difficulties in withdrawing funds. At that time, only two of the mystery clients managed to get their funds back.
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