Tough EU regulatory regime forces Abshire-Smith to close shop in the UK

Tough EU regulatory regime forces Abshire-Smith to close shop in the UK

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The well-known Forex brokerage in London Abshire-Smith is closing downs its operations in the United Kingdom, a regulatory filing with the UK’s Companies House has revealed. Among the reasons for the cessation of financial activities is the UK’s decision to leave the European Union, as well as the newly put in place restrictions on CFD trading by the European Securities and Markets Authority last August.

With a registered office in London, the CFD brokerage Abshire-Smiths held a license by the Financial Conduct Authority and operated another broker brand – Nexsus Financial Markets.

The decision of Abshire-Smith to close shop in the UK comes in the wake of news about two other UK brokerages, Fixi Markets and Formax Prime, which also ceased providing financial services to British traders several weeks earlier. Fixi Markets has not been active since December last year and its funds are as of yet frozen by the British authorities. It would appear that the FCA has reasons to suspect fraudulent activities on part of the brokerage. Formax Prime also closed down in December but not due to trouble with the regulatory body, but, it has been alleged, due to the new restrictions by ESMA.

However, Abshire-Smith remains just one of the many cases we have seen lately in the UK of Forex brokerages quitting the trade due to the pressure put by the new regulatory restrictions of ESMA early August 2018. Among the new restrictions is a ban on binary options trading and a leverage cap of 1:30. Even though ESMA has had the support of the EU and states as its official goal the protection of the client, all this has been the cause for a serious setback in the Forex industry.

 

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