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Summary of the decision in case 618/2017/CEC on the failure of the European Securities and Markets Authority (ESMA) to open an investigation into the Cypriot supervisory authority’s handling of an alleged fraud by an online trading firm

Available languages: en
  • Case: 618/2017/CEC
    Opened on 11 May 2017 - Decision on 12 Jun 2018
  • Institution(s) concerned: European Securities and Markets Authority

The complainant is one of the many customers worldwide who was not able to recover his deposits from an online trading firm licensed in Cyprus.

He complained to the Cyprus Securities and Exchange Commission (CySEC) about the actions of the firm. He then complained to ESMA about the alleged lack of adequate supervision of the firm by CySEC. He requested ESMA to open a “breach of Union law investigation” against CySEC under the ESMA Regulation.

ESMA informed the complainant that it was inquiring into CySEC’s supervision of the firm, but had not yet decided whether to open a “breach of Union law” investigation. Unhappy with ESMA’s handling of his complaint, the complainant turned to the European Ombudsman.

In the course of the Ombudsman’s inquiry, ESMA’s Chair decided not to initiate a breach of Union law investigation.

The Ombudsman found that ESMA has taken a number of actions in relation to the complaints it received regarding the alleged failure of CySEC to carry out its supervisory tasks. She considered that ESMA’s decision, not to open a breach of Union law investigation into CySEC’s supervision of the firm, was reasonable.

The Ombudsman thus found no maladministration by ESMA and closed the inquiry.