CySEC protecting investors, fuelling growth

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The investment sector continues to grow steadily despite continuous challenges, positively contributing to the growth of the broader financial services sector and the Cypriot economy, said the Cyprus Securities and Exchange Commission (CySEC).

In a media briefing on Tuesday, CySEC’s Vice Chair, George Karatzias, reaffirmed the authority’s commitment to establishing the island as one of the safest and most attractive investment destinations through effective supervision, ensuring investor protection and healthy growth of the market.

“CySEC continues to enrich the sector with new legislative regulations to ensure the protection of investors and the smooth operation and development of the market through introducing new investment products,” said Karatzias.

He argued that “the regulatory framework in Cyprus is now fully aligned with that of the rest of the European Union”.

Karatzias noted that the supervisory responsibilities of CYSEC have significantly expanded in recent years, including new service providers.

“This marks a significant step towards fulfilling CYSEC’s vision and mission of establishing the Cypriot capital market as one of the safest, most reliable, and attractive investment destinations through effective supervision.”

The number of supervised entities has increased by 12% over the last four years, indicating that Cyprus continues to gather substantial advantages as an investment destination.

CySEC oversees 837 entities, compared to 746 in 2019, with approximately 90 new applications under examination.

This includes 252 Cypriot Investment Firms providing investment services, such as portfolio management, investment advisers, and executing orders for various financial instruments.

Additionally, CYSEC oversees the collective investment and asset management sector, contributing to the alternative financing of the Cypriot economy.

Some 322 Management Companies and Collective Investment Organisations are under the supervision of CySEC, managing funds exceeding €10.7 billion.

CySEC is also the regulatory authority for Crypto Asset Service Providers, overseeing their compliance with anti-money laundering and counter-terrorism financing regulations.

It also invests in process automation through specialised systems, human resources, and new surveillance systems to enhance its supervisory infrastructure’s overall efficiency and effectiveness.

The body has acquired a specialised system to analyse and monitor the supervised entities’ online marketing material and social media activities.

As a result of supervisory controls by CYSEC, administrative sanctions totalling €6 million have been imposed over the last three years, with €5.3 million directed towards Investment Firms and Regulated Markets Law violations.

“CySEC’s role does not end with punishing companies in the wrong.

“One of our tasks is to protect the investors.

“And by investors, we are not referring to institutional investors but the general public who have been increasingly engaging in investments,” said Karatzias.

CySEC promotes financial literacy and awareness through public campaigns, interviews, and social media.