This interview belongs to a number of talks with small investors from all over the world, who were damaged by Cypriot broker „IronFX Global Ltd“.
Clients suffered damage with this broker not because they made a loss by trading with speculative instruments, but because IronFx has been refusing to return a large amount of clients‘ funds since early 2015.
According to figures related to the number of disputes before Cyprus financial arbitration body, IronFx has been withholding the funds of at least 1251 clients.
This misconduct was not properly sanctioned by Cypriot and European authorities till now. No clients‘ compensation procedure was started.
Zsolt, based in Budapest, Hungary, is a typical victim of this broker.
He never traded, just requested the withdrawal of his deposit and never got his money back.
We interviewed him:
Hello Zsolt, first of all thank you for your willingness to talk about this story, quite unknown to the unspecialized public. First question: how have you known of this broker and what did you move you to open an account?
- I attended a forex training in 2013 and here I heard about IronFX for the first time. At that time IronFX seemed to be a solid company.
Have you been contacted by the company before or after opening the account?
- I was contacted after opening my first account.
How much did you deposit?
- A total amount of 8000 USD, several parts in time and per accounts.
Which financial instruments did you trade?
- I did not start trading on my live accounts. I just deposited, but I have been testing my strategies on test accounts.
So you did not trade at all ?
- No, I did not. As I mentioned, I had not started any trading activities.
When did you request withdrawal of funds? What amount did you request?
- I requested the withdrawal of all my funds of 8000 USD on 26 August 2015, as I first heard of bad news about IronFX.
And what happened?
- Nothing, my withdrawal request has not been processed since that time.
Did you complain to the company?
- Of course, I inquired and complained. At the beginning – for months – they kept saying that they need a little more time for the withdrawal processing, because they had to filter the cheats.
What was the company final response?
- After months, they sent an email accusing me of “abusive trading activities”.
They really accused you of „abusive trading activities“ despite the fact that you had not traded at all?
- Yes, they did. As I opposed their allegations and requested evidence, they sent me an one-sentence arrogant email, stating that they had closed my case with the previous email.
After that, I imagine that you have turned to authorities. When did you begin to file formal complaints and to which authorities?
- First I submitted my complaint to the Cypriot financial regulator CySEC in September 2015 and to the Cypriot Financial Ombudsman in November 2015. After months of inactivity by Cypriot authorities I realized that Cypriot authorities don’t take the victims’ part. So I turned to EU authorities, first to the European supervisor ESMA (European Securities and Markets Authority), later to other EU institutions as well.
Did you receive an answer or a feedback?
- Nothing at all or nothing useful. I usually got the same answer from EU authorities:
the given authority has no power to directly intervene in individual cases and I should turn to Cypriot authorities such as the CySEC or the Financial Ombudsman, or file my case to a Cypriot court.
From the CySEC, I’ve got the following answer: The CySEC has not restitution power in individual cases and I should turn to the Cypriot Financial Ombudsman or finally to a Cypriot court. The Cypriot Financial Ombudsman collected fees of € 20 from me (and from other victims) in November 2015 and has not done anything since that time. There has not been any useful feedback.
Did you hire a lawyer?
Following the flood of complaints submitted to Cypriot and European authorities, Cypriot regulator CySEC investigated the accounts of IronFx, who finally settled to pay a fine of 335,000 Euros for „possible“ infringements of law.
The fine does not represent any kind of compensation for clients. In order to get compensation, the CySEC invited clients to file a complaint to the Financial Ombudsman of Cyprus. Did you follow this recommendation?
- Yes I did, as I mentioned. But without any result.
More than 9 months have elapsed after you submitted your case to the Financial Ombudsman? Did you receive any update?
- They are tricky. Although I filed my case and paid the € 20 fee on 4 November 2015, they started the examination procedure only on 8 February 2016 i.e. 3 months later. So they can say that the officially allowed 9 month procedure time has not expired. I have not received any really informative feedback about my case.
With much cynicism, European supervision authorities are inviting damaged clients to „go to court“ . But jurisdiction is in Cyprus. Did you think about suing IronFx before court in Cyprus? If not, why are you reluctant to file a lawsuit in Cyprus?
- No, I am not thinking of going to court. At a Cypriot court I would be unprotected as a foreigner, while it would be a familiar environment for IronFX. Why should I think that a Cypriot court would be unbiased after seeing the undisguised partiality of the CySEC and the Financial Ombudsman? The good political relations of IronFX are well known. On a video related to the inauguration of the IronFX headquarters I have seen Markos Kashiouris, the chairman and owner of IronFX, and Cyprus president shaking their hands and smiling at each other.
Thank you for the interview, Zsolt.
((More interviews here))