Cantor Index fined £70,000

[gmca686]

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]

"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]

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]

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]

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]

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]

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.

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]

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.........

 

[TWI]

Financial Services Authority Fines Cantor Index GBP70,000

That's really going to impact their bottom line. What a joke!

 

[Roberto]

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]

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]

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]

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]

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.

 

[Robertral]

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

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!!!!!!

 

[roberk]

:cheesy:

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

 

[the blades]

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!!!!!!

tut tut.

take a minute mate, it really was a light hearted comment.

 

[Robertral]

tut tut.

take a minute mate, it really was a light hearted comment.

actually I'm sorry about writing that.....was very drunk etc.......I just like arguments have a good night tonight boys have a mad one and don't let me pi*s you off......

 

[the blades]

actually I'm sorry about writing that.....was very drunk etc.......I just like arguments have a good night tonight boys have a mad one and don't let me pi*s you off......

no offence taken - and I had to write this to become a "senior". Now I really know about ther markets

 

[maxpain]

This business is a modern version of old days Horse Dealing. Societe General (as an example) has some 700 stock warrants out there. In Sweden/Finland this is a huge business. They use a lot of terms to explain why the price of the warrant doesn´t change while the underlying has moved significantly. They should shut down that business for good. Don´t think they are allowed in the US. Stay away if you aren´t an experienced trader. I regard myself as rather good at it and I find it very hard to make any money on them. Losing is very easy but that´s how they are constructed. It´s all about charting. Many warrants will never ever get into the money and are useless and easy to manipulate for the MMs. A legal scam business is what it is - nothing else.
I do them on a daily basis so I know what scumbags they are - if you beat them they steal from you - I make phone calls to them as a regular part of my trading day - telling them who they really are - and it often pays off. When you are about to beat them they suddenly get computer problems - Internet connection problems or just plainly changes the volatility in order to have to pay you lesser than they should do.

- A Happy New Year - & stay away from these products the next year