Octa Markets Cyprus’ majority shareholder has lost his
voting rights after the Cyprus Securities and Exchange Commission (CySEC) moved
to restrict his management influence over the firm.
Regulator Cuts Influence
CySEC said Prozorov’s role as ultimate beneficial
owner was “prejudicial to the sound and prudent management” of the firm. At
its August 25 meeting, the regulator voted to suspend the exercise of his
voting rights, which cover 95% of the company’s share capital.
Prozorov is also barred from serving on the board or
exercising any management duties. The regulator explained in a statement that the
measures were designed to end Prozorov’s influence over the Cyprus Investment
Firm (CIF).
The Cyprus move follows enforcement actions in India,
where authorities seized Prozorov’s assets, including a luxury yacht. India’s
Directorate of Enforcement (ED) accused him and OctaFX of defrauding investors
with false promises of high returns and laundering funds through mule accounts
linked to shell e-commerce companies.
India’s Investigation
Indian regulators have previously fined OctaFX for
operating without authorization, while Singapore also blocked access to its
website earlier this year.
Related: India “Cherry” Picks a Luxury Yacht in Probe Against Octa
In July, India’s Enforcement Directorate (ED) attached
assets worth about $15.3 million linked to Prozorov as part of its ongoing
investigation. The seized assets also included two houses in Spain, a
minijet boat, and a high-end car.
The yacht, named Cherry, is reportedly an
Italian-built commercial vessel operating in the Western Mediterranean. The ED
said the attachment order bars the sale, transfer, or mortgage of the assets,
although the owner may continue to use them while the probe continues.
A few weeks later, India’s securities regulator reached a settlement with Tauga Private Limited (formerly OctaFX India Private Limited)
over its alleged links to OctaFX,
which is now not authorized to operate in the country. The company reportedly agreed
to pay INR 3.2 million (around $37,000) but did not admit or deny the
regulator’s findings.
Comments from the Company
“CySEC has taken targeted governance measures to ensure that
no shareholder can influence the management or decision-making of Octa Markets
Cyprus Ltd. Our Board of Directors independently oversees the firm in line with
MiFID II/CySEC rules,” the company told Finance Magnates.
“None of the executives or managers of Octa Markets Cyprus
Ltd is involved in any legal proceedings or investigations, nor are they
associated in any way with the aforementioned organizations,” the company explained.
“The EU operation (octaeu.com) is separate from offshore
brands operating outside the EU,” the company added. “No systems, client onboarding processes, or
payment rails are shared between the EU CIF and any non-EU entities.
Additionally, Octa Markets Cyprus Ltd does not offer services in India.”
This article was written by Jared Kirui at www.financemagnates.com.
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