South African regulator the Financial Sector Conduct Authority (FSCA) has “provisionally” suspended the licence of FX broker JP Markets SA (Pty) Ltd, citing issues in processing its clients’ withdrawals for quite some time.
The watchdog handed down a temporary suspension on the FSP license of the South Africa based-firm after it received numerous complaints from clients missing to get their deposits back.
The license suspension does not preclude JP Markets from processing the client withdrawals. A quick check on our side, however, shows the amount of complaints related to this problem has been coming to the light more than a year ago, as well as more withdrawal complaints keep on surfacing.
But while the license suspension is in force, the company is not permitted to enter into a business relationship with any person, accept any new customer, or provide any services.
In a statement, the FSCA added that it is also considering further enforcement actions, which will be made public in due course. The suspension and possible further enforcement actions would depend on the findings of its investigations into this case.
“The Authority has decided to provisionally suspend the FSP licence, pursuant to the commencement of an investigation into the contraventions of certain financial sector laws by JP markets and numerous complaints received from clients based on JP Markets’ failure to honour client withdrawal requests. During the period of JP Markets provisional suspension, it is also not permitted to take on any new business,” the regulator further states.
JP Markets has been operating in the country since 2016 under the approval from the Financial Services Board no: 46855. The broker also has a presence in Kenya, Pakistan, and Bangladesh.
The FSCA, however, clarified that JP Markets isn’t authorized to act as an OTC derivative provider and therefore is not permitted, even under regular features of its business, to “originate, issue, sell or make a market in OTC derivatives.”
South Africa enjoys a strong and well-organized financial market, and therefore has become a popular destination for brokers looking to expand. It is one of the world’s top ten capital markets and boasts thousands of investors. The country itself is a diverse market that is largely devoid of the market saturation seen in other jurisdictions such as Europe.