The Cyprus Securities and Exchange Commission (CySEC) has withdrawn the Cyprus Investment Firm (CIF) authorisation of Conotoxia Ltd, effectively ending the firm's regulated investment services activities in Cyprus. Conotoxia Ltd operated as the investment services arm of the Conotoxia group and previously offered trading in contracts for difference (CFDs) across a range of asset classes, including foreign exchange, stocks, indices, commodities, ETFs, futures, and cryptocurrencies.
CySEC stated that the withdrawal decision was taken at a meeting held in December last year. The regulator concluded that Conotoxia Ltd no longer fulfilled the conditions under which its authorisation had been granted, citing failures to comply with ongoing requirements under Cyprus investment services legislation.
Regulatory Deficiencies Identified by CySEC
According to CySEC, the deficiencies leading to the withdrawal related to several key areas of the firm's governance and structure. These included the suitability of a member of its board of directors and the requirement to maintain at least two persons effectively directing its business activities. The regulator also raised concerns over the suitability of a shareholder and the firm's organisational arrangements.
CySEC indicated that these shortcomings meant Conotoxia Ltd no longer met the standards required to hold a CIF authorisation. The decision follows earlier enforcement action, with the regulator noting that the firm's licence had been suspended since July last year under a separate decision published on the same day.
Post-Withdrawal Obligations for Conotoxia Ltd
Following the withdrawal of its authorisation, Conotoxia Ltd has been instructed by CySEC to immediately remove all references to the provision of investment services, as well as any mentions of its CySEC licence and supervision, from its websites and other materials. The company has also been ordered to investigate and resolve all customer complaints submitted to it.
Additionally, CySEC has mandated that Conotoxia Ltd must ensure it does not provide investment or ancillary services after the withdrawal of its authorisation. These measures are intended to align the firm's activities with its new regulatory status and to address any outstanding issues affecting clients.
Broader Context Around the Conotoxia Group
The decision in Cyprus comes against the backdrop of recent developments in Poland involving Cinkciarz.pl and related entities within the wider Conotoxia group structure. Polish prosecutors have expanded fraud charges against the group's CEO and are continuing their investigation into alleged client losses and frozen accounts. These developments provide broader regulatory context around parts of the group, although the CySEC decision focuses specifically on Conotoxia Ltd and its compliance with Cyprus investment services legislation.
