Cantor Index fined £70,000

gmca686

Active member
117 3
Article from my Proquote feed!

DJ Financial Services Authority Fines Cantor Index GBP70,000

Edited Press Release

LONDON (Dow Jones)--The Financial Services Authority (FSA) Thursday announced that it has fined Cantor Index Limited GBP70,000 for running a misleading campaign promoting spread betting.
The company's senior management failed to ensure there were adequate systems and controls in place to ensure that its financial promotions were systematically monitored.
This failure resulted in the misleading advertising campaign entitled 'Free Xda' for Cantor Mobile, the firm's new spread betting device.
The promotional material, which included flyers handed out at London stations, posters and advertisements on television and in the popular press, did not contain adequate warnings about the risks of spread betting and consequently put a large number of potential customers at risk.
A key risk of spread betting is that if a spread bet position moves against the customer they can lose far more than their initial deposit.
Although the firm's terms and conditions contained risk warnings which the customer had to agree to before they could spread bet, the risk warnings were not sufficiently prominent and the FSA found that Cantor Index could not assume investors had read and understood them.
The FSA also found that the structure of the offer of a "free" combined handheld computer and mobile telephone known as an "Xda", incentivised consumers to spread bet.
Additionally, it was promoted in a way that attracted the attention of relatively less experienced investors, and the firm did not consider the greater potential risk posed or take appropriate additional steps to ensure that those investors understood the risks associated with spread betting.
In fixing the amount of penalty the FSA has recognised that no customer of Cantor Index suffered any loss as a result of these failings and the potential impact of these failings was mitigated by the remedial action since undertaken by Cantor Index.

(END) Dow Jones Newswires
December 30, 2004 05:15 ET (10:15 GMT)

newbies be careful!
regards,
G McA
 

chump

Senior member
2,212 274
"newbies be careful!"..........Braindead also be very careful ! .......one wonders at what point individual responsibility will ever be recognised .... much easier and much more palateable to blame 'them' ;)
 

Orion

Active member
103 0
Nanny state alive and well. Pity the hugely expensive FSA can't devote our taxpayers money to more relevant activities, preferably BEFORE the horse has bolted.
 

donaldduke

Experienced member
1,665 257
Sounds like the FSA flexing its muscles just for the sake of it.
They probably hadnt collected enough in fines for the year so probably are making
up the numbers before the year ends.

Who gets to keep the 70K anway?
 

The General

Active member
199 16
FWIW Cantors has been fined many, many times (not necessarily Spread betting arm). Bearing in mind they are an aggressive, arrogant and ruthless American company, it's not really surprising that they are a now a fairly easy target for the authorities.
 

sid392

Member
84 0
Orion said:
Nanny state alive and well. Pity the hugely expensive FSA can't devote our taxpayers money to more relevant activities, preferably BEFORE the horse has bolted.

I agree, what a shame but a sad and sorry state of the time we live in. If the goverment spent as much time on putting things right instead of trying to get as much money out off our pockets as they can by fineing us for everything they can think off, we might want to stay here......

But Tony has to go on his hols, and someone has to pay for it.................

(but thats politics for you - better not go there)
 

Roberto

Experienced member
1,069 11
gmca686 said:
In fixing the amount of penalty the FSA has recognised that no customer of Cantor Index suffered any loss as a result of these failings and the potential impact of these failings was mitigated by the remedial action since undertaken by Cantor Index.
Seems a bit of a savage fine, then, in the circumstances, doesn't it? But maybe not when you look at the turnover ...(?)

As a "consumer", personally I'm continually reassured by how very careful, meticulous and interventionist the regulatory body is.

The General said:
FWIW Cantors has been fined many, many times (not necessarily Spread betting arm). Bearing in mind they are an aggressive, arrogant and ruthless American company, it's not really surprising that they are a now a fairly easy target for the authorities.
I see ... they're actually one of the few I've never used at all, so I didn't know that, mon Génerale. I'm told, though, that equal attention is given by the FSA to all the spread-betting firms. They certainly inspect every trade transacted by every client of every firm. I was pretty surprised to discover this, actually, but it certainly seems to be true: I was told this both by a friend from university who now works there, and by directors of two SB firms as well.
 

The General

Active member
199 16
Well the number of times that Cantors has had to pay out (I'm talking abt the OTC derivatives business specifically) in the last 10 yrs I think makes them an easier target. Cantor's policy is: if something's not working/gone wrong then throw money at it. This is true of both lawsuits and the hiring of new people. They have enuff money not to worry abt growing organically (or even semi-organically), they just go out and offer people six figures to start tomorrow and promise them a bonus in 6 mths time - the number of times they have been sued by their own for failing to pay promised (contractual) bonuses would astonish you.........
 

Roberto

Experienced member
1,069 11
twalker said:
That's really going to impact their bottom line. What a joke!
Maybe not, but it's certainly going to get people talking.

Quod erat demonstrandum.

I'm sure it's only designed as a reminder of teeth, rather than as a real show of them. After all, "in fixing the amount of penalty the FSA has recognised that no customer of Cantor Index suffered any loss as a result of these failings and the potential impact of these failings was mitigated by the remedial action since undertaken by Cantor Index." What do you want, blood? :)
 

Roberto

Experienced member
1,069 11
GammaJammer said:
I wonder if they're gonna pay it in one cash lump, or maybe offer £35K and a job lot of ex-demo XDAs
Dunno ... I heard that the IG quote on Cantor's possible fine was 69900-70100 so they certainly got it right.
 

Trader333

Moderator
8,601 931
Chump posted:

...one wonders at what point individual responsibility will ever be recognised .... much easier and much more palateable to blame 'them'

I totally agree with you. The next likely move by the EU bureacrats (other than banning direct access trading), will be to make all of us take advice about the potential risks we are taking prior to crossing a highway and signing numerous papers saying so.

The Nanny state has got so far out of hand that no-one is responsible for anything anymore.


Paul
 

Roberto

Experienced member
1,069 11
Paul, do you think it's a good thing or a bad thing that the spread-betting industry is so tightly regulated?

I suspect there's something of a dichotomy here between people who think that all spread-betting firms are crooks and people who think that all regulation amounts to or at least fosters an undesirable avoidance of responsibility. (I don't think either of these things myself.)
 

the blades

Experienced member
1,336 275
Roberto said:
Dunno ... I heard that the IG quote on Cantor's possible fine was 69900-70100 so they certainly got it right.


nah - that was the spread on direct access. The tightest the spread bet firms could offer was 50000-75000.

:devilish:
 

Robertral

Well-known member
446 3
the blades said:
nah - that was the spread on direct access. The tightest the spread bet firms could offer was 50000-75000.

:devilish:

My binary maket on you being a wa*ker is 99 choice!!!!!!!! wanna trade???? mine in size, any size you want!!!!!! idot......direct acceess; great joke....do u get access via a kellogs voucher??
PS I guess I gonna get told off for this post as most of you, ahem, "traders" can't handle my comments!!!!!! amazing!!! please stop lookign at your £5 a point positions and actually learn about the markets before TRYING to trade!!!!!!!!! really!!!!!!
 
 
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